TORONTO—The euro held around 12-month lows as news about aid for debt-laden Greece buffeted the common currency.
The euro slipped back below $1.32 Wednesday as a news conference with International Monetary Fund Managing Director Dominique Strauss-Kahn, German Finance Minister Wolfgang Schaeuble and European Central Bank President Jean-Claude Trichet offered few concrete details.
Mr. Schaeuble said Berlin is prepared to rush through the disbursement of funds to help Greece but didn't say how much the aid package will be worth.
"There are still a lot of question marks and it does appear that there is no real deal in place," said Ian Stannard, currency strategist at BNP Paribas in London. "It is as if the negotiations are far from complete."
Late Wednesday morning, the euro traded at $1.3138 from $1.3176 late Tuesday. The dollar was at 93.91 yen from 93.17 yen, while the euro was at 123.38 yen from 122.76 yen. The U.K. pound was at $1.5171 from $1.5249. The dollar was at 1.0902 Swiss francs from 1.0877 francs.
Doubts about the aid package for Greece and worries that Portugal could be the next euro-zone member to face a funding crisis had knocked the euro overnight to a 12-month low at $1.3142. Optimism that the news conference with the IMF, ECB and German officials might reveal decisive news about the bailout plans then sent the euro rebounding to an intraday peak at $1.3266. Those hopes proved unfounded, and the euro retreated in response.
News related to the Greek debt crisis has kept trading choppy, which is unusual on a day when a decision from the Federal Reserve's rate-setting committee is due. Market analysts expect the Fed to leave rates unchanged as well as to leave its policy statement calling for rates to stay down for "an extended period."
The Federal Open Market Committee is due to issue a statement around 2:15 p.m. EDT.
Investors have been hungry for details on the extent of the bailout for Greece as well as concrete details about how and when it will be implemented. So far, the information made public has centered on broad assurances.
Details of the bill, including the amounts involved, are to be finalized Sunday when Greece is expected to conclude negotiations with the IMF and the European Commission over its three-year debt-reduction program.
While Mr. Strauss-Kahn didn't say how much the aid package for Greece will be worth, German politicians were prepared to peg a figure to it.
A joint European Union-IMF program will be worth €100 billion to €120 billion over three years, Juergen Trittin, a parliamentary leader for the Green party, said in a statement following Wednesday's meeting with the IMF head in Berlin.
"The aim is to come to a quick agreement among the IMF and the Euro group [of finance ministers]," German Finance Minister Schaeuble said at the news conference.
"For us, it is extremely important that the decision is taken extremely rapidly...that calls for a fast procedure in the German parliament," said Mr. Trichet, speaking at the same news conference.
Germany's lower house could pass the necessary law on Friday, May 7. According to a draft bill seen by Dow Jones Newswires, Berlin will seek parliamentary approval for aid to Greece of as much as €8.4 billion in 2010 and for an unspecified amount in 2011 and 2012.
"European legislators are finally getting the market's point that they have to act very quickly in order to ensure this isn't a contagion," said Boris Schlossberg, director of currency research at GFT Forex in New York. "They kind of let the problem get out of their hands."
Other stressed euro-zone countries, such as Portugal, Ireland and Spain, wait in the wings with their own problems of sovereign debt.
