Euro burdened by Greece, uncertainty high

Tue Jun 30, 2015 7:42pm EDT
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By Wayne Cole

SYDNEY (Reuters) - The euro remained on the defensive in Asia on Wednesday as Greece became the first developed economy to default on a loan with the IMF, setting the scene for another day of uneasy action in markets.

Still, it surprised no one when the International Monetary Fund confirmed Greece had missed a payment on its debt, perhaps taking it a step closer to an exit from the euro.

The IMF said Greece had asked for a last-minute repayment extension earlier on Tuesday, which the Fund's board would consider "in due course."

European finance ministers will confer later on Wednesday over Greek Prime Minister Alexis Tsipras' request for a new two-year loan to pay debts that amount to nearly 30 billion euros.

Investors, however, clung to hopes that a deal will be done at some stage to keep Greece in the single currency.

"There is so much uncertainty, speculation, truth and partial truth that many markets are in stasis; waiting to see which way this goes," said Emma Lawson, senior currency strategist at National Australia Bank.

The euro was just a shade lower in early trade at $1.1128 EUR=, having dipped 0.8 percent on Tuesday. Activity was light across the currency market with the U.S. dollar index drifting up to 95.529 from Tuesday's low of 94.847.

Against the yen, the dollar stood at 122.42 JPY=, near a five-week low of 121.93 plumbed overnight.   Continued...

A man gestures as he looks at boards displaying stock prices at the Australian Securities Exchange in central Sydney, Australia June 29, 2015. REUTERS/David Gray