By: Barbara Zigah

In Asian trading today, the common currency Euro retreated after a 6-day win streak as investors bought back the U.S. Dollar to cover short positions. Some market players expect to see the Euro test resistance as U.S. companies repatriate their U.S. Dollars earned abroad in order to benefit from a U.S. tax break proposal. As reported at 12:25 p.m. (JST) in Tokyo, the Euro was trading lower at $1.4470, a decline of 0.5% in intra-day trading. Last week, the common currency saw its best 1-week performance since January when it rallied 2.5%.

Yesterday, S&P, the credit ratings agency, added its voice to Fitch’s earlier statement about the French banks’ proposal to rollover a portion of Greek debt, stating that that action would trigger their selective default rating. Officials from the E.U. said that they were still working out details and were relatively unconcerned with the caution, believing that they can work through it. The Euro is likely to find some support later this week as the European Central Bank’s policy setting meeting meets; analysts expect that the central bank will again take a hawkish tone, setting the stage for a rate hike later this month.