Euro stays near one-month high

The euro held firm below a one-month high on Tuesday, though further climbs after a two-week rally may require clear signals from the European Central Bank later in the week that it plans to raise interest rates next month. The euro slipped from Monday's one-month peak following comments from Eurogroup chairman Jean-Claude Juncker that the common currency was overvalued.
Others cited remarks from a spokesman for the German finance ministry that a second aid programme for Greece was not certain as weighing on the currency. Still, the common currency is being supported by growing expectations that Greece is likely to get a vital slice of aid in July to avoid default as policymakers hope to arrange a voluntary rollover of Greek debt.
In Asia, the euro gained 0.2 percent to $1.4600, but was still off Monday's one-month peak of $1.4659. "Those comments (from Juncker) probably weighed on the euro at the margins. But the direction of a weaker dollar is pretty clear at this point in time, so I'm expecting a bounce in the euro," said Richard Grace, chief currency strategist at Commonwealth Bank in Sydney.
The euro has gained more than 4 percent since climbing off its May 23 trough. The immediate target for the common currency is $1.4732, a 78.6 percent retracement of its May 4 to May 23 fall. A break of that level should take it back to the May 4 high around $1.4939, though many traders think the currency will need a signal from ECB chief Trichet that the institution is ready to raise rates in July.
On the downside, the first support is seen at $1.4568, a 61.8 percent retracement of its fall in May, ahead of $1.4370, its 55-day moving average. Against the yen, the dollar crept up to 80.10 yen, after a brief dip below 80.00 on Monday for the first time since May 5, helped by bids from Japanese importers. Meanwhile, the Australian dollar fell 0.4 percent to $1.0685 , pulled further away from Friday's four-week high of $1.0775 after the Reserve Bank of Australia kept rates on hold and gave no hints of tightening in the immediate future.