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The euro dropped from a two-week high against the dollar as European stocks fell and Greek officials held debt-swap talks for a third day, damping investor demand for the shared currency.
European officials and Greece’s private bondholders agreed in October to carry out a 50 percent cut in the face value of the nation’s debt by voluntarily exchanging outstanding bonds for new securities, with a goal of reducing the country’s borrowings to 120 percent of gross domestic product by 2020. An accord with bondholders is essential to a second financing package for Greece, which faces a 14.5 billion-euro ($18.7 billion) bond payment on March 20.
Greece and its private creditors are close to a final agreement on the framework of a debt swap plan, with the European Union approving the terms so far agreed, newspaper To Vima reported on its website, without citing anyone.
There are still legal, technical and other details that need to be specified and while progress is being made in meetings in Athens, the negotiations are expected to continue beyond today, the Athens-based newspaper reported on its website.
The dollar rallied versus most of its major counterparts as investors sought the relative safety of the U.S. currency. The Dollar Index (DXY), which IntercontinentalExchange Inc. uses to track the greenback against the currencies of six major U.S. trading partners, advanced 0.2 percent to 80.195, rising from the lowest level since Jan. 4. The gauge was still headed for a 1.6 percent weekly drop on reduced demand for a refuge. Purchases of existing U.S. homes climbed 5 percent to a 4.61 million annual pace last month, the most since January 2011, the National Association of Realtors said today.
The Canadian dollar dropped versus the greenback after the nation’s inflation rate fell more than economists anticipated, weakening the argument for higher interest rates.
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