Dollar gains on euro as Greek worries continue

NEW YORK: The dollar gained against the euro Monday amid worries over the fragility of Greece's newest deal with its bailout partners.

Despite ongoing concerns over the US economy's weakness and its sinking stock markets, the dollar picked up ground, with the euro falling to $1.4572 from $1.4637 late Friday.

But the dollar gave up ground to the Japanese currency, trading to 80.07 yen from 80.25.

"The markets do not seem too content with the result of Friday's discussions between Greece and the IMF/EU as we are drifting a little lower," said Capital Spreads analyst Simon Denham.

"The euro lost steam ahead of $1.4640 amid concerns Greece has to overcome several hurdles before it receives aid," said analysts at Brown Brothers Harriman.

However, they also pointed to the continued divergence of views on the threat of inflation between the European Central Bank and the US Federal Reserve as likely to support a stronger euro.

"Looking ahead this week one of the key events is likely to be the ECB meeting where we expect ECB President Trichet to signal a July rate hike," Brown Brothers analysts said in a daily trading note.

"Combined with the positive developments in Greece and the decline in contagion fears (it) suggests that the dollar will remain under pressure."

The dollar traded to 0.8353 Swiss francs from 0.8335, while the pound lost ground to $1.6349 from $1.6424.

Copyright AFP (Agence France-Presse), 2011