By Anchalee Worrachate and Candice Zachariahs - Feb 21, 2012 3:23 PM GMT+0700
The euro climbed to a three-month high against the yen after euro-area finance ministers agreed to award Greece a second bailout package to stave off a default next month.
The 17-nation currency was little changed against the dollar after erasing an intra-day advance as Luxembourg Prime Minister Jean-Claude Juncker said the deal includes a 53.5 percent writedown for investors in Greek bonds, greater than a previous arrangement. The Australian dollar weakened after the Reserve Bank said in minutes of its Feb. 7 meeting that there is scope to ease monetary policy.
“The deal is helping to support the euro in the near term as the outright default appears to have been avoided and short- term uncertainty is removed,” said Chris Walker, a currency strategist at UBS AG in London. “But we remain cautious because several outstanding issues remain unresolved.”
The euro rose 0.2 percent to 105.69 yen at 8:22 a.m. London time, after touching 106.01 yen, the most since Nov. 14. Europe’s common currency traded at $1.3247 after reaching $1.3293 earlier, the strongest level since Feb. 9. The dollar gained 0.2 percent to 79.80 yen.
The so-called Aussie dollar slid 0.4 percent to $1.0711.
To contact the reporters on this story: Anchalee Candice Zachariahs in Sydney at czachariahs2@bloomberg.net; Masaki Kondo in Singapore at mkondo3@bloomberg.net.
To contact the editor responsible for this story: Rocky Swift at rswift5@bloomberg.net
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