Earlier, the euro headed lower as concerns about Greece overcame the markets and worried Forex traders and investors. Good news out of the United States, though, is changing the picture a little bit and providing a measure of confidence that is helping the euro to tenuous gains this morning.
Earlier, the euro dropped on the disappointing news out of Greece. Greek President Karolos Papoulias has said that new Parliamentary elections will be called, since a coalition government has not been formed. However, the new elections might not take place until the middle of June. Many think that the new elections will be a referendum on whether or not Greece should remain in the eurozone. On top of that, the delay in the elections means that Greece may not receive the international aid from the bailout that it needs to keep going. Reports of Greeks withdrawing money from banks in large amounts is are further spurring fears about sovereign debt contagion and panic.
That news brought the euro down earlier, but right now the 17-nation currency is getting some help from better economic news in the United States. Housing starts rose 2.6% in April, and that is providing some positive diversion away from Greece.
At 12:44 GMT EUR/USD is up to 1.2743 from the open at 1.2730. EUR/GBP is up to 0.7997 from the open at 0.7958. EUR/JPY is up to 102.5730 from the open at 102.0650.
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