NEW YORK: The euro fell against the dollar Tuesday following a week of gains after the European Union and IMF reached agreement on recasting Greece's bailout to avert a looming default.
But the dollar's gains were limited by signs that negotiations in Washington over the looming fiscal cliff, remained divided on key issues.
At 2200 GMT the euro was at $1.2938, down from $1.2971 at the same time Monday.
The yen was mixed, falling to 82.16 yen per dollar from 81.98 yen Monday, but gaining to 106.30 yen per euro from 106.38.
Neal Gilbert of GFT said profit taking set in on the euro after its rise ahead of the Greek debt talks Monday.
"The Eurogroup worked overtime yesterday to finally come to an agreement on Greece after two postponements delayed it into this week," Gilbert said.
"In response, risk markets rose, but not as handily as some had expected. The euro-dollar in particular barely reached $1.30 from $1.2960 before profit taking shoved it back down toward the $1.29 handle throughout the US trading session."
Greece won breathing space with long-frozen eurozone loans to restart from December and a first clear admission that a chunk of the country's debt burden will eventually have to be written off.
After 13 hours of talks in Brussels, the eurozone and the International Monetary Fund agreed to unlock 43.7 billion euros ($56 billion) in loans and on the need to grant significant debt relief for decades to come.
Greece must still meet a series of agreed conditions but "the decision will certainly reduce the uncertainty and strengthen confidence in Europe and in Greece," said European Central Bank President Mario Draghi who left the talks before a final press conference.
Meanwhile Gilbert said he expected the yen to slip further ahead of the December 16 Japanese election, with the opposition Liberal Democratic Party leading in the polls.
LDP leader Shinzo Abe has vowed to pressure the Bank of Japan into launching aggressive monetary easing measures if his party wins.
"Since Abe's LDP party is expected to be victorious in the December 16 elections, the yen may well continue to depreciate," said Gilbert.
In other currencies, the Chinese yuan was steady as the US Treasury ruled against labeling Beijing a currency manipulator, trading at 6.227 yuan per dollar, shy of the record high of 6.220 hit on Monday.
The dollar rose to 0.9306 Swiss francs from 0.9278 francs.
The British pound fell to $1.6019 from $1.6026.
-AFP/ac
Euro sags after new Greek debt deal sealed
This article
Euro sags after new Greek debt deal sealed
can be opened in url
http://newsschooldame.blogspot.com/2012/11/euro-sags-after-new-greek-debt-deal.html
Euro sags after new Greek debt deal sealed
