Bloomberg the Company & Products

Bloomberg Anywhere Login


Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world.


Financial Products

Enterprise Products


Customer Support

  • Americas

    +1 212 318 2000

  • Europe, Middle East, & Africa

    +44 20 7330 7500

  • Asia Pacific

    +65 6212 1000


Industry Products

Media Services

Follow Us

Euro Rises From Three-Month Low on Easing of Greece Debt Crisis

May 10 (Bloomberg) -- The euro rose from a three-month low as Europe’s bailout fund confirmed that aid to Greece had been received and officials reported progress forming a government, easing concern the nation will leave the monetary union.

The shared currency ended eight days of losses against the U.S. dollar, matching the longest losing stretch on record, after a European Commission official said Greece’s financial “needs are covered.” Greece’s socialist leader Evangelos Venizelos said he saw the first “good omen” in four days of attempts to form a coalition government and avert a new election. Higher-yielding currencies advanced as U.S. jobless claims fell, boosting demand for risk.

“Greece partially got its aid payment paid out, so that alleviated them from the worries on defaulting on debt payments next week,” said Mark McCormick, a currency strategist at Brown Brothers Harriman & Co. in New York. “But the downside risks to the euro persist. You still have the uncertainty over Greece -- you don’t know what the next government is going to look like.”

The euro rose 0.1 percent to $1.2936 at 5 p.m. New York time after falling to $1.2912 yesterday, the weakest level since Jan. 23. The shared currency gained 0.4 percent to 103.39 yen. It slipped to 102.76 yesterday, the lowest since Feb. 16. The yen was down 0.4 percent to 79.92 per dollar.

The 17-nation currency’s 10-day relative strength index fell to 24.3 yesterday and traded at 32.2 today, suggesting the currency is headed for a reversal of recent losses. A reading below 30 signals a currency is oversold and may be poised for a correction.

‘Getting Ahead’

“The market was getting ahead of its skis,” said Richard Franulovich, a senior currency strategist at Westpac Banking Corp. in New York. “You had an earthquake out of Greece this weekend, an exceptionally aggressive shorting of the currency and, as you process all the news, you tend to retrace these moves.”

Brazil’s real rose the most among the major currencies, advancing 0.8 percent to 1.9535 per dollar. New Zealand’s dollar rose 0.1 percent to 78.53 U.S. cents.

First time claims for jobless benefits in the U.S. fell by 1,000 to 367,000 in the period ended May 5, in line with the median forecast in a Bloomberg News survey and the lowest since the end of March, the Labor Department said today in Washington.

Greece “can continue to function with the disbursement,” commission spokesman Olivier Bailly told reporters in Brussels after yesterday’s European Financial Stability Facility decision to disburse immediately only 4.2 billion euros ($5.4 billion) of a 5.2 billion-euro loan tranche. The remaining 1 billion euros will be “disbursed in due time to cover future needs.”

‘Very Close’

Venizelos spoke after Democratic Left leader Fotis Kouvelis outlined a proposal for a unity government that will work to keep the country in the euro and the European Union while negotiating a gradual “disengagement” from bailout austerity measures.

“Our views are very close,” Venizelos said to reporters in Athens.

Greek bonds fell for an eighth day after UBS AG Chairman and former European Central Bank governing council member Axel Weber said there was still a risk of a Greek default.

The risk of a hard default in Greece “is not off the table,” Weber said at a conference today in London. Spain’s problems carry an “extremely high contagion risk for Italy” and the rest of Europe, said Weber, who’s also a former head of Germany’s Bundesbank.

If the euro had fallen today, it would have extended its weakening streak to nine days, the longest on record since the common currency’s inception in 1999.

‘Risk-Negative Events’

“We are playing through one of those risk-negative events right now,” Alan Ruskin, global head of Group of 10 foreign-exchange strategy at Deutsche Bank AG in New York, said in a Bloomberg Radio interview with Tom Keene and Ken Prewitt. “The politics in Greece in particular are highly unpredictable and really sets the cat among the pigeons.”

The British pound rose against the dollar after the Bank of England’s Monetary Policy Committee held its quantitative easing target at 325 billion pounds ($525 billion), ending a second round of stimulus.

The decision was forecast by 43 out of 51 economists in a Bloomberg News survey. Officials also left their benchmark interest rate at a record low of 0.5 percent.

The pound gained 0.1 percent $1.6146 after weakening as much as 0.2 percent. Sterling added 0.1 percent to 80.13 pence per euro.

Krona, Krone

Sweden’s krona fell for a ninth day against the greenback after Statistics Sweden said the inflation rate slowed to an annual 1.3 percent, from 1.5 percent in March.

The currency dropped 0.9 percent to 8.9824 per euro, and weakened 0.8 percent to 6.9434 per dollar.

Norway’s krone remained lower versus most of its major counterparts after the nation’s central bank left the benchmark interest rate unchanged at 1.5 percent, the lowest in two years, as policy makers show greater determination to curb the currency’s gains.

The krone declined 0.5 percent to 5.8683 per dollar and fell 0.5 percent to 7.5907 per euro.

Australia’s dollar rose 0.3 percent to $1.0082.

The unemployment rate in Australia unexpectedly dropped to a one-year low of 4.9 percent in April, from 5.2 percent the previous month, the statistics bureau said today. Economists forecast a rise to 5.3 percent.

The euro has weakened 4.1 percent over the past six months, the worst performance among the 10 developed-nation currencies tracked by Bloomberg Correlation-Weighted Indexes. The dollar rose 2.6 percent, and the yen dropped 1.3 percent.

“The recent political developments in the euro zone are likely to weigh on the euro throughout the summer” even as the currency gets short-term support after falling to key technical levels, said Neil Jones, head of European hedge-fund sales at Mizuho Corporate Bank Ltd. in London. “There’s a lack of unity, a lack of co-ordination.”


To contact the reporters on this story: Catarina Saraiva in New York at; Lukanyo Mnyanda in Edinburgh at

To contact the editor responsible for this story: Dave Liedtka at

Please upgrade your Browser

Your browser is out-of-date. Please download one of these excellent browsers:

Chrome, Firefox, Safari, Opera or Internet Explorer.