Forex Pros – The euro erased early gains against the U.S. dollar on Thursday, slipping to a two-day low amid concerns that Greece may need to restructure its debt after Greek bond yields surged to a record high earlier in the day.
EUR/USD retreated from 1.4514, the daily high, to hit 1.4388 during European late morning trade, shedding 0.33%.
The pair was likely to find support at 1.4290, the low of March 8 and resistance at 1.4519, Wednesday’s high and a 15-month high.
The yield on 10-year Greek debt rose 0.14% to 13.06%, a euro-era record high. The two-year note yield surged 0.48% to 17.41%.
The record gains came after German Finance Minister Wolfgang Schaeuble was quoted in German newspaper Die Welt as saying that Greece may need to take “further measures” if a June audit by the European Commission and the European Central Bank shows the nation’s debt burden isn’t sustainable.
The euro also fell against the yen, with EUR/JPY tumbling 0.89% to hit 120.00.
Also Thursday, in its monthly bulletin the ECB maintained its hawkish stance on inflation after last week rate increase, warning that it sees “upside risks” to price stability and will continue to monitor inflation “very closely.”
“It is essential that the recent price developments do not give rise to broad-based inflationary pressures over the medium term,” the ECB said.
ForexPros.com
