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Forex - Euro broadly weaker, but holding above day's lows

Published 07/06/2015, 06:39 AM
© Reuters.  Euro broadly weaker after Greek vote, but holding above lows
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Investing.com - The euro remained broadly weaker against the other major currencies on Monday, after Greece overwhelmingly voted against further austerity measures, but the single currency remained supported above the day’s lows.

EUR/USD was last at 1.1026, off 0.75% for the day after falling to one-week lows of 1.0970 overnight.

Greeks overwhelmingly rejected conditions for a bailout package from creditors in a referendum on Sunday, fueling doubts the country’s future in the euro zone and escalating a standoff with its lenders.

Greek Prime Minister Alexis Tsipras welcomed the outcome of the vote and said Athens was returning to bailout negotiations with the express goal of reopening banks, which have been shut for over a week after capital controls were imposed.

Without more emergency funding from the European Central Bank, Greece's banks are facing a cash crunch within days. The ECB was to discuss whether to maintain emergency funding for Greek banks at their current restricted level later Monday.

Euro zone leaders were expected to hold a conference on Tuesday night to discuss the aftermath of the Greek referendum.

The euro found some support after Greek Finance Minister Yanis Varoufakis unexpectedly resigned on Monday, despite the referendum results.

In a statement Varoufakis said his decision was prompted in part by “some European participants” expressing a desire for his part in any further negotiations to end.

His replacement was expected to be named after a meeting of Greek political leaders later Monday.

The single currency was lower against the yen and the pound, with EUR/JPY last at 13531 after rebounding from earlier lows of 133.91. EUR/GBP was at 0.7091, up from lows of 0.7056.

The euro was also slightly firmer against the Swiss franc, with EUR/CHF at 1.0430 from around 1.0357 earlier.

The threat of intervention to weaken the franc by the Swiss National Bank helped to support the euro.

The dollar was steady against the safe haven yen, with USD/JPY at 122.72, holding above overnight lows of 121.89.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, rose 0.32% to 96.68, boosted by weakness in the euro.

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