The euro dollar exchange rate is 0.132% lower on the day with 1 EUR = 1.3667 USD. The euro pound exchange rate is 0.053% higher with 1 EUR = 0.8705 GBP. "After trading as low as 1.3585 overnight, the euro rallied strongly late in the session to finish New York trade at 1.3681 following reports the Greek government was close to a deal regarding the payment of the next tranche of bailout funds," says a morning exchange rate note from Ben Potter at IG Markets. The euro dollar exchange rate opened the Asian session at 1.3684, before falling sharply to a low of 1.3598 following news that S&P had unexpectedly cut Italy’s credit rating to A from A+. Moody’s has had Italy on review for downgrade for a number of months, so there is an expectation that the agency will follow suit with a downgrade. However, this move from S&P could come as a bit of a surprise. In other news this morning, there are reports circulating that Greek Prime Minister George Papandreou is considering calling a referendum on whether or not Greece should continue to tackle its debt crisis within the eurozone, or by exiting the single currency. "We haven’t seen much of a reaction in markets yet to this news, but should further details emerge, it could be very interesting. Tonight, traders will be keeping an eye on the German ZEW economic sentiment reading due at 7pm (Melbourne time), as well as the latest Greek coupon payment and a Spanish bill auction," says Potter.

Source