Euro eases against dollar ahead of Greece talks

TOKYO: The euro eased in Asian trade on Wednesday with few trading cues as cautious markets focused on a scheduled conference call between the leaders of Greece, Germany and France later in the day.

Comments from China Premier Wen Jiabao that uncertainties in the global economy had increased pressured the euro and hit risk appetite, dealers said.

But he also pledged to continue expanding investment in debt-hit Europe, and called on eurozone leaders to "courageously look at China's relationship from a strategic viewpoint".

The euro bought $1.3660 in Asian trade, down from $1.3682 in New York late Tuesday. The European common currency was lower against the Japanese unit, trading at 105.03 yen against 105.21 in New York.

The dollar stayed almost flat against the yen, changing hands at 76.91 yen.

"The underlying mood still feels like a market wondering where the next banana skin for the euro is likely to lie," noted Daragh Maher at Credit Agricole, adding that sentiment was unlikely to improve soon.

Markets were focused on a scheduled conference call by Greek Prime Minister George Papandreou with German Chancellor Angela Merkel and French President Nicolas Sarkozy later in the day.

On Tuesday, an Italian debt auction worth close to 6.5 billion euros ($8.8 billion) that saw investors demand increased returns and volatile trade in French banking shares underlined weak confidence in the eurozone, dealers said.

However, this was offset by continued talk of China purchasing debt, and the euro managed a small rally overnight. Italy confirmed on Tuesday that its finance minister met the head of the biggest Chinese sovereign wealth fund CIC last week.

Copyright AFP (Agence France-Presse), 2011