Euro Rises on Tentative Greece Bailout Deal

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The euro was higher against the dollar Friday as the eurozone conditionally gave Greece a four-month debt bailout extension, easing worries over its future in the eurozone.

Finance ministers of the 19 eurozone countries agreed the draft deal in Brussels, on condition that Greece submits  a list of reform proposals by Monday to its bailout creditors -- the European Union, the European Central Bank and the International Monetary Fund -- for review.

The euro was at $1.1381 late Friday, up from $1.1365 the previous day. It also gained a bit against the Japanese currency, buying 119.03 yen, up from 118.94.

Today's market action showed "investors were not excited or impressed by the Eurogroup's decision," said Kathy Lien of BK Asset Management.

"The lackluster reaction has to do with the fact that the details have not been hashed out, leaving room for another breakdown in the debt deal negotiations."

Greece's bailout program expires at the end of the month. Without an extension, Greece could run out of money and be forced out of the single-currency bloc.

Investors were looking ahead to next week's testimony by Federal Reserve Chair Janet Yellen in Congress for clues about the timing of a hike in interest rates that have been pegged near zero since December 2008.

Dovish minutes of the Fed's January policy meeting, released Wednesday, clouded the outlook for the timing of the rate hike, which had been widely expected in mid-2015.

Yellen will deliver the central bank's twice-yearly account of the state of the U.S. economy, to the Senate on Tuesday and the House of Representatives on Wednesday.

"What the tone of Ms. Yellen's remarks suggests about the arrival of a rate hike will be of critical importance for the dollar," said Joe Manimbo, senior market analyst at Western Union Business Solutions.

 

22H00 GMT   Friday      Thursday

EUR/USD       1.1381      1.1365

EUR/JPY        135.51       135.18

EUR/CHF       1.0676       1.0792

EUR/GBP       0.7390       0.7373

USD/JPY        119.03       118.94

USD/CHF       0.9382       0.9495

GBP/USD       1.5399       1.5415

 

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