Investing.com - The euro dipped against the dollar on Tuesday as the curtain rose on a new act in the ongoing Greek drama, this time with the government working through snags over accepting austerity measures.
In Asian trading on Tuesday, EUR/USD hit 1.3122, down 0.06%, firming from a session low of 1.3111 and off from a high of 1.3134.
The pair was likely to find support at 1.3029, Monday's low, and resistance at 1.3141, Monday's high.
Greece has been working on a deal with private-sector creditors to restructure its debts, and for weeks now a deal has remained just within sight but not in ink.
Disagreements over terms surrounding the haircut private lenders will take remains up in the air, yet Greece has to strike a deal with those private lenders if it wants to tap fresh bailout money down the road.
More recently, however, Greece has been negotiating terms of a second bailout package arranged with the E.U., the International Monetary Fund and the European Central Bank.
The package was supposed to come to EUR130 billion, but now Athens says it may need up to EUR145 billion, and not all Greek political parties have reportedly been onboard with austerity measures that come with such aid up to now.
Greece’s Prime Minister Lucas Papademos, however, did win the support from leaders of his political coalition to work together to improve the economy.
Furthermore, the IMF has said that the eurozone debt crisis is threatening growth in China, a major economic powerhouse.
However, hope remains that all sides will find a way to keep Greece in the eurozone.
"The reason the euro is not falling more rapidly and more aggressively is, even with some of the disquieting headlines that we’ve seen from Greece and that they still don’t have a deal, there is an underlying expectation that a deal will be reached," said Nick Bennenbroek, head of currency strategy at Wells Fargo & Co. in New York, according to Bloomberg.
Wealthier European nations supporting Greece are growing increasingly edgy.
French President Nicolas Sarkozy met with German Chancellor Angela Merkel in Paris on Monday, after which Merkel expressed growing impatience.
"I don’t understand why we need a few more days — time is running out," Merkel said.
Outside of Greece, Europe saw some good news.
German factory orders grew more than expected in December, rising 1.7% from November, outpacing expectations for a 0.5% gain mainly due to demand outside of the eurozone.
The euro, meanwhile, was down against the pound and also against the yen, with EUR/GBP losing 0.04% to 0.8295 and EUR/JPY down 0.05% at 100.46.
Later Tuesday, Fed Chairman Ben Bernanke is due to testify on the economic outlook and federal budget situation before the Senate Budget Committee in Washington.
In Australia, the Westpac Consumer Sentiment Index will hit the wires.
In Europe, markets will keep an eye on French trade balance figures, German industrial output data while the British Retail Consortium will unveil its Shop Price Index.
Canada will release its latest numbers on building permits.
In Asian trading on Tuesday, EUR/USD hit 1.3122, down 0.06%, firming from a session low of 1.3111 and off from a high of 1.3134.
The pair was likely to find support at 1.3029, Monday's low, and resistance at 1.3141, Monday's high.
Greece has been working on a deal with private-sector creditors to restructure its debts, and for weeks now a deal has remained just within sight but not in ink.
Disagreements over terms surrounding the haircut private lenders will take remains up in the air, yet Greece has to strike a deal with those private lenders if it wants to tap fresh bailout money down the road.
More recently, however, Greece has been negotiating terms of a second bailout package arranged with the E.U., the International Monetary Fund and the European Central Bank.
The package was supposed to come to EUR130 billion, but now Athens says it may need up to EUR145 billion, and not all Greek political parties have reportedly been onboard with austerity measures that come with such aid up to now.
Greece’s Prime Minister Lucas Papademos, however, did win the support from leaders of his political coalition to work together to improve the economy.
Furthermore, the IMF has said that the eurozone debt crisis is threatening growth in China, a major economic powerhouse.
However, hope remains that all sides will find a way to keep Greece in the eurozone.
"The reason the euro is not falling more rapidly and more aggressively is, even with some of the disquieting headlines that we’ve seen from Greece and that they still don’t have a deal, there is an underlying expectation that a deal will be reached," said Nick Bennenbroek, head of currency strategy at Wells Fargo & Co. in New York, according to Bloomberg.
Wealthier European nations supporting Greece are growing increasingly edgy.
French President Nicolas Sarkozy met with German Chancellor Angela Merkel in Paris on Monday, after which Merkel expressed growing impatience.
"I don’t understand why we need a few more days — time is running out," Merkel said.
Outside of Greece, Europe saw some good news.
German factory orders grew more than expected in December, rising 1.7% from November, outpacing expectations for a 0.5% gain mainly due to demand outside of the eurozone.
The euro, meanwhile, was down against the pound and also against the yen, with EUR/GBP losing 0.04% to 0.8295 and EUR/JPY down 0.05% at 100.46.
Later Tuesday, Fed Chairman Ben Bernanke is due to testify on the economic outlook and federal budget situation before the Senate Budget Committee in Washington.
In Australia, the Westpac Consumer Sentiment Index will hit the wires.
In Europe, markets will keep an eye on French trade balance figures, German industrial output data while the British Retail Consortium will unveil its Shop Price Index.
Canada will release its latest numbers on building permits.