By: Barbara Zigah

Investor concerns over Greece’s fiscal problems, with the government’s austerity measures resulting in rioting on the streets of Athens, is putting heavy pressure on the common currency, which fell against the U.S. Dollar. In Asian trading today, the Euro is hovering only slightly above a 6-week low of $1.4123 struck yesterday on the EBS trading platform; as reported at 2:49 p.m. (JST) the Euro was trading at $1.4216 against the U.S. Dollar, a decline of 0.2%. Since early May when EUR/USD peaked near $1.4940, the Euro has lost nearly 5% of its value.

One trader in Japan noted that markets are very wary, and uncertainty is high, as markets ponder how long the Greek government can avoid a debt restructuring. Another Greek rescue package is the expectant result of the meetings of Eurozone finance ministers to be held next week, which might result in a Euro sell-off.

What is currently supporting the Euro is speculation that the ECB is likely to raise interest rates within the next few months, and one forex strategist expects that the Euro may pull-back in the short term, but eventually head toward $1.45. The divergence between the ECB and the Federal Reserve is clearly factoring into Euro support.