Forex - Aussie weaker in early Asia with market focused on Greece

Investing.com - The Aussie fell slightly in early Asia on Wednesday with investors looking ahead to events in Greece as prospects for a deal on sovereign debt talks comes down to the last minute.

In Australia, the AIG services index eased to 49.6 in May from 49.7, while up ahead comes first quarter GDP with a gain of 0.7% expected quarter-on-quarter.

Later in the day comes the HSBC China services PMI for May with 53.3 seen.

AUD/USD traded at 0.7769, down 0.03%, while EUR/USD changed hands at 1.1152, down 0.01%, and USD/JPY was quoted at 124.00, down 0.10%.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was flat at 95.99.

Overnight, the dollar tumbled over 1% against the U.S. dollar index, after data showing U.S. factory orders fell for the sixth straight month in April sparked concerns over strength of the economy.

The dollar weakened after the Commerce Department said factory orders fell 0.4% in April, confounding expectations for a 0.2% increase. March’s figure was revised to 2.2% from a previously reported 2.1%.

On a year-over-year basis, factory orders dropped 6.4%, the sixth straight monthly decline.

The unexpectedly weak data sparked fresh fears over the outlook for second quarter growth after data last month showed that the U.S. economy contracted 0.2% in the first quarter.

The dollar had gained ground on Monday as upbeat U.S. economic reports, including on manufacturing activity and construction spending, fuelled optimism that the economy was regaining momentum after a weak first quarter.

Euro gains were held in check however after Greek Prime Minister Alexis Tsipras said Tuesday that his government submitted a "comprehensive proposal" to its lenders late Monday and added that a decision on an agreement now rested on European political leaders.

Greece is due to make a €305 million payment to the International Monetary Fund on Friday but warned last month that it will be unable to make the repayment if a deal is not reached by then.