BLBG: Euro Trades Near Three-Week Low Amid Signs Greek Aid in Doubt
By Ben Levisohn
March 22 (Bloomberg) -- The euro traded near the lowest level in almost three weeks versus the dollar as European leaders debated what measures may be needed to aid Greece in tackling its budget deficit.
The yen rose against all of its major counterparts. Ulrich Wilhelm, a German government spokesman, said European Union leaders may decline to make a decision on financial aid for Greece at a summit this week because the country hasn’t asked for help. Australia’s dollar and the South African rand fell versus the greenback on concern global sovereign debt burdens will stifle the economic recovery.
“The euro has been pretty volatile,” said Camilla Sutton, a Bank of Nova Scotia currency strategist in Toronto. “It’s just ongoing uneasiness about what will transpire in terms of support for weaker euro members.”
The euro touched $1.3464, the weakest level since March 2, before trading little changed at 1.3522 at 11:25 a.m. in New York, compared with $1.3530 on March 19. The yen rose 0.6 percent to 121.79 per euro, from 122.51 on March 19. It gained 0.5 percent to 90.06 per dollar, from 90.54.
The euro may fail if European leaders don’t decide quickly on helping Greece in financing the region’s biggest budget deficit, Reuters reported that Deputy Prime Minister Theodoros Pangalos said. Without a speedy decision, the euro will make no sense and it will take decades to recover, Pangalos said in Athens, Reuters reported.
EU leaders must not create “illusions” for markets by building expectations for Greek aid, German Chancellor Angela Merkel said in an interview with Deutschlandfunk radio that aired yesterday. Her remarks came after Greek Prime Minister George Papandreou and European Commission President Jose Barroso said the bloc should spell out its rescue plan at the March 25- 26 summit in Brussels.
To contact the reporter on this story: Ben Levisohn in New York at blevisohn@bloomberg.net
