Euro dips in Asia

The euro dipped but stayed within sight of a 15-month peak against the dollar on Friday, with further losses expected to be limited given the diverging outlook for monetary policy in the eurozone and the United States. Not helping the dollar, several top Federal Reserve officials have sounded relaxed about inflation despite the recent surge in oil prices, adding to expectations the Fed will not cut short its $600 billion debt-buying programme.
The euro, in contrast, remains supported by the prospect of higher interest rates in the eurozone despite comments by Germany that Greece may need to restructure its debt. "When you are talking about the relative yield play, it probably does favour the euro," said Andrew Robinson, FX analyst for Saxo Capital Markets in Singapore. The euro eased 0.1 percent from late US trade on Thursday to $1.4472, still not very far from a 15-month high of $1.4521 hit earlier this week.
An option barrier in the euro lies at $1.4525 and there are stops above that level, going up to $1.4550, said a trader for a European bank in Singapore. The existence of such an option barrier suggests the euro could face selling from options players if it rises close to the barrier level, but also means the euro could find it easier to rise if the barrier is taken out or it expires.
Market players said the euro could find the going tough above $1.45 given the sovereign debt problems, which took a turn for the worse after Germany suggested for the first time that Athens may have to restructure its large debt load. Greek borrowing costs soared to new highs on Thursday and added pressure on other financially weak eurozone members.
The euro fell 0.2 percent against the yen to 120.76 yen, but remained well above a low of 119.26 yen hit the previous day. The trader for a European bank in Singapore cited selling of the euro against the yen by model funds. The single currency has given up some ground against the yen since hitting an 11-month peak of 123.33 yen on trading platform EBS earlier this week. The dollar edged up 0.1 percent against a basket of major currencies to 74.770, near a 16-month trough of 74.617 struck on Thursday.