Euro weakens as wary market watches Greek debt plan

[NEW YORK] The euro weakened against the dollar on Monday as traders waited to see if Greece could complete the agreement reached last week with eurozone partners on its bailout program.

Greece's new anti-austerity government late Monday said it would miss a midnight (2300 GMT) deadline to provide a list of reforms to its international lenders needed to confirm the four-month extension of its bailout.

The deadline was part of the agreement reached Friday in Brussels to give Athens breathing room as its 240 billion euro (US$270 billion) bailout is set to expire at the end of the month.

Without an extension, Greece could run out of money and be forced out of the single-currency bloc.

A Greek government source insisted that Brussels would get the proposals on Tuesday morning, in time for eurozone finance ministers to discuss them in a conference call in the afternoon.

"Greece remains the focus, and at this point, all they did was kick that can down the road," said David Gilmore of Foreign Exchange Analytics.

"The problem is the government is caught in a bind.... Not so much any issues with the ECB or the eurozone, but the pressures they'll get internally from their constituents, because they've run on that platform of change."

The dollar, meanwhile, firmed ahead of Federal Reserve Chair Janet Yellen's twice-yearly testimony to Congress on the state of the US economy on Tuesday and Wednesday. Traders hoped to gain insight about the Fed's plan to raise interest rates this year.

"The key focus will be on the Fed's timeline for normalization as the Fed balances the risks of US growth with the tepid performance in the rest of the G7 universe and the general lack of any headline inflation," said Boris Schlossberg of BK Asset Management.

AFP