Euro off six-week low in Asia

The euro fell against the dollar on Friday but remained above a six-week low, finding some respite after commodities bounced off their overnight lows and as investors refocused their attention on the prospects for a further rise in eurozone interest rates. But lingering worries about Greece's debt problems continued to weigh on the euro, which has shed roughly 5 percent from a peak near $1.4940 hit in early May.
A recent rout in commodities such as silver and oil has also hurt risk appetite and prompted traders to brace for the possibility of further unwinding of dollar-funded bets on risk assets. "A rescue package for Greece will probably emerge at an Ecofin meeting next week, and so that could be when we see a peak (in the euro's sell-off)," said a trader for a major Japanese bank in Tokyo.
The euro fell 0.2 percent to $1.4216, but remained above a six-week low of $1.4123 hit on Thursday on trading platform EBS. The euro earlier dipped below support near $1.4193, the top of the cloud on daily Ichimoku charts, a form of Japanese technical analysis widely used among market players.
A clear breach of that support could open the way for a drop towards levels around $1.3950, the bottom of the daily cloud. The yen edged higher against the dollar and the euro, with the dollar slipping 0.4 percent to 80.59 yen and the euro shedding 0.7 percent to 114.56 yen. The dollar fell to 80.44 yen at one point, with traders saying the dollar's drop against the yen gained steam after stop-loss orders were triggered near 80.60 yen.
The Australian dollar, another currency that has retreated this month after rallying sharply in recent months, fell 0.2 percent to $1.0640. Selling of the euro and the Australian dollar by hedge funds helped to drag those currencies lower on Friday, traders said. The scope of the Australian dollar's rally over the past year, from a trough near $0.8080 last June to a 29-year peak of $1.1012 earlier this month, suggests that a further pull-back might be in the cards, said Satoshi Okagawa, senior global markets analyst at Sumitomo Mitsui Banking Corp in Singapore. The dollar index, which measures the US dollar's value against a basket of currencies, held steady at 75.272, near a three-week high of 75.645 hit on Thursday.