Investing.com - The dollar dropped against a basket of other major currencies on Friday, as hopes for progress in Greece debt negotiations boosted demand for riskier assets.
EUR/USD advanced 0.79% to 1.1123 after Greece offered to make painful spending cuts and hike taxes late Thursday, in a last-ditch request to win one more bailout from Europe before the country descends into bankruptcy.
Athens was seeking at least €50 billion over the next three years. In exchange, the government presented a number of austerity measures that were said to total between €12 billion and €13 billion - significantly more than Greece’s previous commitments.
The move brought Greece one step closer to a deal with its European creditors, who plan to make a final decision Sunday about whether to grant the country additional emergency loans.
In the meantime, the Greek government extended bank closures and the €60 daily limit on cash machine withdrawals until Monday.
The pound was also higher, with GBP/USD up 0.59% to 1.5469.
The U.K. Office for National Statistics reported on Friday that the trade deficit narrowed to £8.00 billion in May from £9.39 billion in April, whose figure was revised from a previously estimated deficit of £8.56 billion.
Analysts had expected the trade deficit to widen to £9.70 billion in May.
Elsewhere, the dollar was higher against the yen, with USD/JPY up 0.68% to 122.17 and lower against the Swiss franc, with USD/CHF declining 0.83% to 0.9398.
The yen came under pressure as demand for safe-haven assets weakened after the Shanghai Composite rallied over 4% on Friday. The surge was sparked after Chinese authorities increased scrutiny of short selling and eased rules for insurers to invest in blue-chips stocks in wake of China’s recent stock plunge.
Equity markets in China have lost more than 30% over the past three weeks, roiling global financial markets.
The Australian and New Zealand dollars were higher, with AUD/USD up 0.08% to 0.7454 and with NZD/USD adding 0.16% to 0.6752.
Earlier Friday, data showed that Australia's home loans declined by 6.1% in May, confounding expectations for a 3.5% fall. Home loans rose 0.7% in April, whose figure was revised from a previously estimated gain of 1.0%.
Meanwhile, USD/CAD held steady at 1.2714.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was down 0.51% at 96.17.