Euro stays up in Asia

The euro held firm against the US dollar on Friday, reflecting hopes of central bank action to counter potential fallout from Sunday's crucial election in Greece, and after disappointing US economic data.
G20 officials told Reuters that central banks from major economies stand ready to take steps to stabilise financial markets by providing liquidity and preventing a credit squeeze if the Greek election result roils markets.
New claims for US state jobless benefits rose for the fifth time in six weeks and consumer prices fell in May, opening the door wider for the US Federal Reserve to further ease monetary policy.
These factors prompted unwinding of market players' massively short positions on the euro, and drove the dollar to a three-week low against a basket of currencies, though worries about Spain's troubles in financing its debt remained in place.
The euro's latest rebound from its two-year low of $1.2280 on June 1 started after disappointing US payroll data rekindled speculation of another stimulus from the US Federal Reserve.
Although Chairman Ben Bernanke dropped no hint of an immediate action when he spoke last week, hopes for more policy steps were heightened after the UK government and the Bank of England unveiled a 100 billion pound ($155 billion) funding scheme for banks to boost credit on Thursday.
Thus the dollar slipped to its lowest level in three weeks against a basket of currencies, with the dollar index falling to as low as 81.703, a low since May 23.
Against the yen, the dollar fell 0.6 percent to one-week low of 78.83 yen after the Bank of Japan announced no policy change, though that is in line with market expectations. But a further dollar further fall towards 78 yen is likely to raise caution over Japan's intervention.
The euro rose 0.1 percent to $1.2644, extending Thursday's 0.6 percent gains and edging near a high of $1.2672 hit right at the beginning of the week in a knee-jerk reaction to the announcement of a plan to support Spanish banks.
While the outcome of the Greek election on Sunday is seen as holding the key in the near term, the euro's technical outlook is improving, analysts said.
Commodity-linked currencies also held firm on hopes of more policy support for the global economy, with the Australian dollar staying near a one-month high of $1.0034 hit on Thursday. It last stood at $1.0025.