Following last Friday’s dollar rally which came in the wake of a better than expected non-farms payroll report, the U.S. Dollar retreated in London trading as markets refocus their attention on Greece. In the latest news on Greece’s attempt to renegotiate a debt deal, the Troika reaffirmed that it is rejecting Greece’s latest plea for a modified bailout plan. According to the Greek Prime Minister, Greece’s economy will only improve if they can get better terms from the Troika.
As reported at 8:41 am (GMT) in London, the EUR/USD was trading at $1.1353, a gain of 0.4% after falling more than 1.5% last Friday after the US labor report. The U.S. Dollar Index, which includes the Euro as one of its weighted components, was down 0.3% to trade at 94.459 .DXY; last Friday, the Index had gained more than 1%. Despite the Euro’s gains in today’s trading, analysts say that the picture remains poor for the Euro given the situation in Greece, and a rebound of the common currency is good only as a selling opportunity.
Risk Appetite Eyed
An improvement in overall risk sentiment could provide some support to the USD/JPY pair, according to one Tokyo-based currency strategist, though the uncertainty of the growing Greek crisis could impact risk appetite. The USD/JPY pair was trading at 118.61 Yen, a loss of 0.5% for the greenback following last Friday’s climb to 119.23 Yen.