Euro falls versus dollar in London

The euro fell against the dollar on Wednesday after early demand ran into technical resistance but the shared currency may catch fresh bids if Federal Reserve meeting minutes suggest US interest rates will stay low. The euro traded at $1.4220, down 0.1 percent on the day, with intra-day stops below $1.4210. Traders said early sovereign demand took it to a session high of $1.4287, but gains were blocked by its 55-day moving average around $1.4290.
Higher shares and commodity prices offered some support to riskier currencies including the euro, while the dollar was on the back foot as lower US Treasury yields tarnished the appeal of US assets ahead of FOMC minutes due later in the day. The market took in its stride the risk of a Greek debt restructuring after European finance officials on Tuesday acknowledged such a possibility. Range trading in the euro suggested the market was wary of taking a strong direction on the latest development in the eurozone debt crisis at present, while analysts saw the risk of more dollar downside.
Eurogroup leader Jean-Claude Juncker on Tuesday said there was a need to move towards a "soft restructuring" of Greek debt, but other officials are fighting any such move, while Greece's prime minister has said restructuring would do more harm than good. Market participants said the euro's immediate downside was protected by the 21-hour moving average around $1.4244.
The dollar slipped 0.4 percent to 81.12 yen, as the benchmark 10-year US Treasury yield hovered around its lowest in five months. Narrowing US/Japanese government bond yield spreads often put selling pressure on the dollar versus the yen. The dollar index was up 0.04 percent at 75.428, but well below a six-week high around 76.0 hit earlier in the week.
The US central bank releases minutes from its May policy meeting at 1800 GMT. Investors expect the Fed to underline its determination to keep rates near zero even after it ends its cheap-money policy of quantitative easing in June, and an even more dovish stance could prompt selling in the dollar. The Australian dollar slipped 0.4 percent to $1.0581, struggling in the aftermath of weak wage data which further reduced the case for a rate rise next month