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Euro holds up on relief over Greek bank funding

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The euro held up against the dollar in Asia on Friday after rallying on assurances Greek banks will get emergency funding.

[TOKYO] The euro held up against the dollar in Asia on Friday after rallying on assurances Greek banks will get emergency funding.

The common European currency bought US$1.1465 in Tokyo trade against US$1.1475 in New York Thursday afternoon, while edging down to 134.59 yen from 134.89 yen.

"The euro has reversed Thursday's Asian slump that saw a low of 1.1305... as the US dollar eases moderately across the board," National Australia Bank said in a note.

The dollar slipped to 117.35 yen against 117.55 yen in US trade on Thursday.

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Calm has returned to markets after the euro plunged on Wednesday with the European Central Bank announcing it would no longer allow Greek banks to use government debt as collateral for loans.

But the ECB did not pull the plug entirely.

Assurances Thursday that the banks could still tap the ECB's emergency liquidity assistance programme helped quell fears of an immediate banking crisis.

The access should help protect them against a possible run by depositors while Athens seeks to renegotiate its international bailout with creditors.

Investors were waiting for a key US jobs report to be released later Friday.

National Australia Bank said it continued to monitor the Greek situation with a view to sell the euro again.

"But the unfolding line of negatives on the US data front also suggests the USD could take a further step back if tonight's US employment report disappoints in any way," it said.

Its consensus forecast was for an increase of 230,000 jobs in January following December's 252,000 increase, with the unemployment staying at 5.6 per cent.

AFP

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