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Euro lifts as hopes mount for Greek crisis resolution

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The euro gained ground on Wednesday on hopes that Greece's debt crisis will be resolved in a few days, averting a default to its European Union creditors.

[NEW YORK] The euro gained ground on Wednesday on hopes that Greece's debt crisis will be resolved in a few days, averting a default to its European Union creditors.

The euro, which had fallen to a five-week low of US$1.0916 on Tuesday, rebounded as Greek Prime Minister Alexis Tsipras vowed to present "credible" reform plans to creditors by Thursday.

The 19-nation currency rose to US$1.1074 around 2100 GMT from US$1.1007 at the same time Tuesday.

European Union President Donald Tusk has set the "final deadline" for a deal on Sunday at a summit of all 28 EU leaders.

"Between the unusual suspension of trading on the NYSE and the meltdown in Asian equities, investors sent the euro higher on signs of progress towards a deal for Greece," said Kathy Lien of BK Asset Management.

The New York Stock Exchange halted trading Wednesday for more than three hours due to technical problems that it said were not caused by hacking.

Meanwhile, a weeks-long rout in Chinese equities continued, with stocks losing more than 30 per cent since mid-June.

The Federal Reserve's release of the minutes of the June 16-17 meeting of the Federal Open Market Committee showed policymakers favoured caution about embarking on the first interest rate hike in nine years.

Omer Esiner, chief market analyst at Commonwealth Foreign Exchange, said the Fed minutes were less important to markets than normal because of the heightened level of concern regarding Greece and China.

"On both fronts, underlying conditions have deteriorated markedly since the Fed's mid-June meeting, so the minutes may be largely irrelevant at this point," he said.

AFP

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