SFG: Euro Weakens on Greek Debt Concerns; Oil Falls, Copper Declines
May 30 (Bloomberg) -- The euro weakened for the first time in three days versus the dollar, while oil and copper fell in New York on concern European governments will struggle to resolve the region's debt crisis amid a slowing global recovery.
The euro declined against 12 of its 16 most-active peers and slid 0.3 percent to $1.4282 as of 4:04 p.m. in Tokyo. New Zealand's dollar reached a record high versus the U.S. currency. Crude slipped as much as 1 percent and copper dropped for the first time in five days in New York. The MSCI Asia Pacific Index added 0.1 percent, paring its biggest monthly slump in a year. The Stoxx Europe 600 Index was little changed. Futures on the Standard & Poor's 500 Index advanced 0.1 percent.
Greek Prime Minister George Papandreou said he'll press ahead with new austerity measures even as he failed to win backing from opposition parties. A June 1 report will likely show Australia's economic growth suffered a "dramatic hit" from natural disasters in the nation during the first quarter, Treasurer Wayne Swan said yesterday. U.S. data this week may show employers probably hired fewer workers in May and manufacturing cooled in the world's largest economy.
Greece "will be the focus this week, whether they can agree on the austerity conditions that are required," Tim Condon, head of Asia research at ING Groep NV, said in a Bloomberg Television interview from Hong Kong. Doubts about the global economy will first "hit the peripheral European debt crisis countries," he said.
Austerity Plan
The euro traded at 115.44 yen from 115.67 yen in New York last week. Greece's Antonis Samaras, leader of the biggest opposition party, New Democracy, rejected Papandreou's austerity plan at a meeting with him and other opposition leaders in Athens, saying his party wouldn't be blackmailed. European Union officials have called for consensus on the package, which includes an extra 6 billion euros ($8.6 billion) of budget cuts and a plan to speed 50 billion euros of state-asset sales.
The EU may withhold the next amount of credit to Greece after a report by an international panel of inspectors concluded that the debt-laden country has missed all the fiscal targets agreed in its rescue plan, Der Spiegel said, without saying how it obtained the information.
"There are definitely still peripheral European problems," said Osao Iizuka, head of foreign-exchange trading in Tokyo at Sumitomo Trust & Banking Co., a unit of Japan's third-largest banking group. "The uncertainty is likely to weigh on the euro."
Kiwi, Aussie
New Zealand's dollar, known as the kiwi, fell to 81.83 U.S. cents after earlier rising to 82.19, the strongest level since exchange-rate controls ended in 1985. The nation's trade surplus widened to a record NZ$1.11 billion ($909 million) in April, as soaring commodity prices and Asian demand boosted exports of milk powder, butter and lumber. The surplus was expected to grow to NZ$600 million, according to the median estimate in a Bloomberg News survey.
Australia's dollar slid 0.2 percent to $1.0691, halting a two-day advance versus the U.S. dollar. The S&P/ASX 200 Index dropped 0.4 percent, led by Commonwealth Bank of Australia's 1.3 percent decline, after the Australian Financial Review said the nation may cut a federal government guarantee that protects ordinary bank deposits.
Natural disasters probably cut more than 1 percentage point from economic growth in the first quarter, Swan said yesterday in a weekly economic note. The median estimate in a Bloomberg News survey of 23 economists is for a 0.3 percent contraction in gross domestic product from the final three months of 2010.
