Euro touches three-week high, posts worst month since November

The euro touched a three-week high against the dollar on Tuesday amid hopes that Greece may avoid a debt restructuring, but further gains are likely capped by technical resistance after a weak monthly performance.
While the euro rallied last week on bets that Greece should be able to shoulder its heavy debt burden without restructuring, the currency shared by 17 European countries is still down around 2.8 percent in May, its worst monthly performance since November 2010.
The euro had earlier risen to $1.44245, according to electronic trading platform EBS, buoyed by news that Germany is considering dropping its push for an early rescheduling of Greek bonds in order to facilitate a new package of aid loans for Greece, The Wall Street Journal reported, citing people familiar with the matter.
The report came as Europe has stepped up efforts to draft another bailout package for Greece, and Eurogroup President Jean-Claude Juncker on Monday expressed optimism that a new package was coming together.
The euro pared gains against the dollar after a German Parliament member told business newspaper Handelsblatt that Greece should leave the eurozone.
In late afternoon New York trading, the euro was up 0.8 percent at $1.4390, below resistance at $1.4454, the 50 percent retracement of this month's fall from nearly $1.50. Above that lies the 61.8 percent retracement of the same move at $1.4568.
The dollar index, which tracks the greenback against a basket of currencies, traded 0.5 percent lower at 74.611. It is up about 2.3 percent in May, its best monthly performance since last November.
The dollar was up 0.2 percent against the Swiss franc at 0.8529 francs, hovering near a record low of 0.8457 hit Monday on EBS.
The dollar last traded at 81.50 yen, up 0.7 percent on the day, heading into the New York close, but off the session peak of 81.77 yen. US economic data this week will culminate with Friday's closely-watched non-farm payrolls report.
Michael Woolfolk, managing director at BNY Mellon Global Markets in New York, said having failed to get any traction below the 1.40 level, players are expected to retest the EUR/USD's upside this week, barring any material surprises.