Euro wobbles in Asia

The euro slipped in Asia on Thursday, with initial relief over assurances from Germany and France about keeping Greece in the euro bloc wearing off amid scepticism over whether eurozone policymakers can really help Athens avoid default. The euro is under pressure as market players, spooked by fears that a possible debt default in the euro bloc could unleash a major financial crisis, remain ready to sell the euro and risk assets into any rally.
The euro slipped 0.3 percent to $1.3714, off a high of $1.3784 hit on Wednesday after a joint statement from Germany and France helped bolster hopes that Greece will receive the next tranche of aid from the EU/IMF and avoid imminent default. Many traders expect the euro to eventually test Monday's seven-month low just below $1.35, while resistance is seen at a previous support point around $1.3835 and then $1.3895, a 38.2 percent retracement of its fall this month.
The euro is also burdened by mounting worries over contagion of the debt crisis to the eurozone's bigger economies. Speculation is rife that Moody's might downgrade its rating on Italian debt soon as it is almost 90 days since the US agency said it may cut the Aa2 rating. Also attracting attention is Spain's debt auction later in the day. Spain is expected to pay a heavy premium to borrow up to 4 billion euros via three bond issues after Italy had to pay the highest interest rates in the euro era to sell five-year debt on Tuesday.
This will be followed by an informal meeting on Friday of euro bloc finance ministers. The Australian dollar slipped 0.6 percent to $1.0193, near a one-month low of $1.0178 marked on Wednesday, on worries about fallout from the European crisis on the global economy.
The New Zealand dollar slipped 0.5 percent to $0.8127 after a dovish-sounding statement by the Reserve Bank of New Zealand . As expected, the central bank left rates on hold at 2.5 percent. The yen was supported not far from its record high against the dollar by virtue of Japan having one of the most liquid debt markets in the world, attracting some safe-haven bids.
The dollar stood at 76.70 yen, near a record low of 75.941 yen hit last month, though concerns that Tokyo may intervene to curb the yen's strength supported the dollar. The Swiss franc, traditionally seen as safe-haven, has been capped after the Swiss National Bank set a ceiling of 1.20 francs per euro last week.