The euro traded lower against its major rivals in European deals on Tuesday, as Greece’s negotiations to unlock financial aid are not making sufficient progress, with Athens still far to reach deal with European creditors.
The International Monetary Fund warned that it may not grant new financial aid to Greece, unless its Eurozone creditors write off significant portions of its sovereign debt, the Financial Times reported on Monday.
The IMF’s warning raised doubts that it may withhold its portion of EUR 7.2 billion tranche of bailout aid to Greece, which Athens struggles to secure in order to avoid bankruptcy.
Greece is still deadlocked over issues on fiscal forecasts and labor and pension changes with its EU creditors, even as it is due to repay ?763 million in loans to the IMF a day after the eurogroup meeting.
German bunds also rose, sending yields down. Yields on German 10-year note fell 0.43 percent, while that of 30-year notes were down at 0.95 percent.
In economic news, figures from Eurostat showed that Eurozone producer prices declined as expected in March.
The producer price index fell 2.3 percent year-over-year in March, slower than previous month’s 2.8 percent decrease. The figure was also matched with economists’ expectations.
The currency has been falling in the previous session.
In European trading, the euro fell to a 6-day low of 1.1065 against the greenback and a 5-day low of 133.10 against the yen, down from Monday’s closing values of 1.1144 and 133.86, respectively. The next possible support for the euro may be found around 1.10 versus the greenback and 130.00 against the yen.
The euro that ended Monday’s trading at 0.7370 against the pound dropped to a 4-day low of 0.7314. If the euro continues its downtrend, it may challenge support around the 0.725 mark.
The single currency hit 1.0381 against the franc, its lowest since April 28, while falling to a 5-day low of 1.3412 against the loonie. Continuation of the euro’s downtrend may lead it to support around 1.02 against the franc and 1.33 against the loonie.
Looking ahead, U.S. and Canadian trade data for March and U.S. PMI for April are slated for release in the New York session.
At 12:30 pm ET, Bank of Canada Senior Deputy Governor Carolyn Wilkins will address Board of Trade of Metropolitan Montreal.
The material has been provided by InstaForex Company – www.instaforex.com