Euro slips as all eyes fall on Greece

Posted On: May 19, 2011
Questions about next steps and fallout from the possibility of Greece restructuring its repayments influenced the euro to trim losses on Thursday, Reuters reports.

Despite recent falls in the euro and other more risky currencies, investors were on the hunt for openings to purchase the common currency. Jean-Claude Trichet, the chief of the European Central Bank, wrote a report stating the institution he leads will refuse Greek bonds should they be offered as collateral if the Aegean nation restructures its payment schedule.

"There are signs of people wanting to put on new short dollar and long risk positions, but it is too early for the euro to rebound aggressively," Sebastien Galy, currency strategist at Societe Generale, told the news service.

Juergen Stark, a policymaker at the European Central bank, also will not accept Greek bonds, a spokesman said. But that hard-line view might be a negotiating play that aims to slow down the momentum directing Greece toward restructuring.

"There is still a lot of noise from euro zone officials about how to go about finding a solution to the Greek debt problem," Galy said.

Category: Industry News

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