Dollar broadly lower vs. rivals, eyes on Greece bailout

Published 02/20/2012, 05:00 AM
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Investing.com - The U.S. dollar was broadly lower against its major counterparts on Monday, as hopes that euro zone finance ministers will agree to deliver Greece’s second bailout supported demand for riskier assets.

During European late morning trade, the dollar was lower against the euro, with EUR/USD climbing 0.63% to hit 1.3222.

Euro zone finance ministers were to meet in Brussels later Monday to discuss the approval of a much needed EUR130 billion financial aid for Greece.

Without a bailout, Athens faces the threat of defaulting when a EUR14.5 billion bond redemption comes due on March 20.

The single currency also found support after China cut the amount of cash banks must hold in their reserves on Saturday, boosting lending capacity in an effort to spur the world's second-biggest economy.

The greenback was also lower against the pound, with GBP/USD advancing 0.21% to hit 1.5863.

A report by property website Rightmove showed earlier that average asking prices for houses in the U.K. jumped 4.1% in February, the highest monthly increase since April 2002, indicating increasing confidence in the housing market.

The greenback was steady against yen and lower against the Swiss franc, with USD/JPY inching down 0.03% to hit 79.54 and USD/CHF dropping 0.65%, to hit 0.9140.

Earlier in the day, government data showed that Japan’s trade deficit widened by JPY0.61 trillion to a record JPY1.48 trillion in January from a deficit of JPY0.87 trillion the previous month.

Analysts had expected Japan’s trade deficit to widen by JPY0.83 trillion in January.

Elsewhere, the greenback was lower against its Canadian, Australian and New Zealand counterparts, with USD/CAD shedding 0.44% to hit 0.9929, AUD/USD climbing 0.54% to hit 1.0762 and NZD/USD jumping 0.96% to hit 0.8401.

In New Zealand, official data showed that producer price inflation input rose more-than-expected in the fourth quarter, rising 0.5% after a 0.6% increase the previous quarter.

Analysts had expected PPI input to rise 0.4% in the fourth quarter.
  
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, fell 0.44% to hit 79.17.

Trade was expected to remain subdued on Monday, with markets in the U.S. remaining closed for the Presidents Day holiday.


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