The euro slipped against the dollar on Monday, as many investors took a pessimistic view of the latest round of euro zone talks on a cash-for-reform deal for Greece. Greece, which must repay a 750 million euro loan to the International Monetary Fund on Tuesday, faces the risk of defaulting on debt repayments and being forced out of the euro zone. Negotiations have moved slowly and its lenders have ruled out a decisive agreement at Monday's meeting of euro zone finance ministers in Brussels.
-- Kiwi slides on New Zealand rate cut speculation Though Athens is hopeful of a positive statement from the Eurogroup meeting, Greece and its EU and IMF lenders remain at odds over budget, labour and pension issues. The euro fell half a percent to $1.1157, well below the two-month peak of $1.1392 struck on Thursday when the outlook for the European economy thawed and euro zone bond yields rallied.
"They (the Greeks) are going to make their next payment but even so ... I get the feeling in the market that there are increasingly more people who are positioning for a Grexit," said Adam Myers, European head of FX strategy at Credit Agricole in London. "More and more people seem to be taking a pessimistic view. That wasn't there even a month ago." New Zealand's dollar was the biggest mover among major currencies, skidding as much as 1.5 percent against its US counterpart to a seven-week trough of $0.7372 as speculation that the country's central bank could cut rates gathered momentum.
The Reserve Bank of New Zealand hinted last month it might cut rates if the economy slowed and inflation stayed low. Against the yen, the US dollar stood little changed at 119.905, after Friday's mixed US jobs data failed to offer much of a buying incentive. The US non-farm payrolls numbers showed a rebound in April, but a significant downward revision to the March figure, and weaker-than expected wage growth. That supported bets that the Fed will not begin hiking rates until late in 2015.
Following last week's unexpected outright win for the Conservatives in Britain's parliamentary elections, sterling stayed close to a 2-1/2-month high, edging down 0.2 percent to $1.5419. "With the UK elections over, attention will shift back towards fundamentals and Bank of England policy and whether it can head towards hiking rates," Kadota at Barclays said.
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