Forex - Euro drops as Greece anti-austerity party wins polls

Investing.com - The euro dropped in early Asia on Monday as Greece's anti-austerity Syriza party won the country's snap national elections Sunday, according to the first official projections from Greece's Interior Ministry, but may fall shy of an absolute majority in the 300-seat parliament and need some outside support.

EUR/USD traded at 1.1155, down 0.44%, while AUD/USD trended lower as well at 0.7875, down 0.42%. USD/JPY traded at 117.66, down 0.11%, on safe haven demand.

The party has pledged to force Greece’s creditors to renegotiate the terms of the country’s €240 billion euro financial bailout, which has roiled markets and imperiled moves to provide more funding for the country.

Japan's December trade balance is due at 0850 local time with a deficit of ¥740 billion yen expected, narrower than the ¥829 billion deficit seen in November.

The Bank of Japan is to publish the minutes of its latest policy meeting, which contain valuable insights into economic conditions from the bank’s perspective

Last week, the euro fell to fresh 11-year lows against the dollar on Friday and hit a seven year trough against the pound, a day after the European Central Bank launched a large scale quantitative easing program to combat slowing growth and inflation in the euro area.

The drop in the single currency came after ECB President Mario Draghi unveiled a €1.2 trillion asset purchase program on Thursday. The central bank will purchase €60 billion in assets per month, starting in March and continuing until late 2016.

Draghi said the program would help return inflation back to the bank’s 2% target. Expectations had been building ahead of the ECB meeting after official figures showed that the annual rate of inflation in the euro area fell into negative territory in December, dropping 0.2%.

Draghi acknowledged the action the ECB took last year was “insufficient” to ward off the threat of deflation in the region.

The dollar remained broadly stronger, boosted by the diverging monetary policy stance between the Federal Reserve and central banks in Europe and Japan.

The Bank of Japan held off on expanding its monetary easing scheme on Wednesday and instead expanded a loan scheme aimed at boosting lending.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was not yet traded at 95.32, it's close on Friday.

In the week ahead, investors will be focusing on Friday’s preliminary data on fourth quarter growth, while the latest euro zone inflation data is also due out on Friday.

Wednesday’s Federal Reserve monetary policy statement will be closely watched, while New Zealand’s central bank is also to hold a policy meeting.

On Monday, in Germany, the Ifo research group is to publish its report on business climate.

The U.K. is to release private sector data on mortgage approvals.