Wed May 25, 2011 7:51am EDT * Euro struggles, Greek debt crisis weighs in choppy trade * Finland OKs Portugal bailout, prompts some EUR demand * Analysts see euro breaking below $1.40 in near term (Reledes, adds quote, details) By Naomi Tajitsu and Anirban Nag LONDON, May 25 (Reuters) - The euro suffered broadly on Wednesday, plumbing a record low versus the Swiss franc as Greece's struggle for political consensus to salvage its finances underlined the possibility that the euro zone debt crisis will knock the single currency lower. Finland's approval of an EU/IMF bailout for Portugal helped the euro to pare some losses versus the dollar, but did little to stop the euro from falling to 1.2298 francs, the weakest since the single currency was launched in 1999. Demand from hedge funds also prompted a short squeeze in the single currency versus the dollar, but analysts say the euro is tainted by ongoing uncertainty surrounding the euro zone debt crisis, and that a fall below $1.40 is imminent. Investors expect Athens, which is digging its way out of massive debts, will have a hard time implementing more austerity measures as the government's main opposition party opposes such a move. [ID:nLDE74O0PW] A government spokesman said Greece has no immediate plans to hold a referendum on austerity measures, quashing earlier speculation of a possible vote. [ID:nATH006104] "The differences between Greek political parties is undoubtedly negative for the euro," said Adam Myers, currency strategist at Credit Agricole CIB, adding that the brief squeeze up in the euro did little to change its downward trend. "Everyone thinks the euro will go down, so it has become more sensitive to bad news from the euro zone," he said, adding that the euro will break below $1.40 later this week, when interest to defend options around that region evaporates. The euro EUR= traded 0.2 percent lower on the day at $1.4074, pulling back from $1.4092 hit after the Finland news. [ID:nLDE74O08X] Traders had said demand from macro funds and other fund managers had also pushed the euro up, adding that gains accelerated after stop-loss orders were triggered above $1.4060. Though Finland's approval removed one uncertainty in the euro zone debt crisis, analysts said underlying sentiment towards the euro was bearish as differences between the European Central Bank and region's politicians grew on whether Greek debt should be restructured or not. [ID:nLDE74O02E] "The Finland news is providing some relief to the euro, but the euro needs a far bigger catalyst to see it move towards $1.43," said Audrey Childe-Freeman, EMEA head of currency strategy at JPMorgan Private Bank. "In the near term, the euro is very much skewed towards the downside and looks very choppy." Traders citied offers from sovereign investors above $1.4100, which were also seen limit any upside in the euro. EUR/CHF SUFFERS The single currency EURCHF=R traded 0.6 percent lower at 1.2325 francs by 1124 GMT, trimming some losses, but analysts see more gains in the Swiss franc, which is a popular investment choice during times of uncertainty. The dollar rose 0.1 percent against a basket of currencies to 75.983 .DXY, not far from a high of 76.366 hit earlier this week, its highest since April 1. It rose slightly versus the yen to 82.04 yen JPY=. The Australian dollar AUD=D4 was down 0.6 percent at $1.0494, having fallen as low as $1.0440 after news that GE Capital (GE.N) was selling its Australian mortgage book stoked speculation that more investors could dump Australian assets. Market participants said sovereign-related demand from the Mideast helped the Aussie to pare early losses. For the moment, the euro is drawing support against the dollar at the bottom of a cloud on the daily Ichimoku chart, a Japanese technical analysis tool popular among traders, and the euro's 100-day moving average, both of which are nestled near $1.3985. A fall below this could open the way for more losses especially since stop-loss orders are said to be lurking below $1.3968, a two-month low struck on EBS on Monday. Citi said in a note that its index on hedge fund positioning showed these investors had unwound long bets on the euro in the past few weeks but they were still in 'overextended territory', implying further losses for the euro. <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ FX COLUMN-Euro breakdown paves way to $1.35 [ID:nL3E7GN0H4] Euro could hit $1.30 if Greece restructures [ID:nLDE74N0U1] ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^> (Editing by Toby Chopra)

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