In the absence of any major economic news for the region, euro traders continued to focus on developments in Greece for direction.
According to Dow Jones Newswires, an unnamed European official said that an announcement for Greece to receive an austerity package worth €4.0 billion will likely be announced on Wednesday. Another official told the news agency that Greece is planning to raise €3.0 to €5.0 billion through the sale of a new ten-year note.
Meanwhile this morning, an EU spokesperson said that today’s talks have focused on Greece’s efforts to correct its budget imbalances and did not include a bailout plan for the beleaguered nation.
The debate is expected to come to a head on Friday, when Greece Prime Minister George Papandreou visits German Chancellor Angela Merkel to persuade her that the nation is doing everything necessary to correct its budget problems.
A bailout package for Greece is widely unpopular among French and German voters, and Greece is looking repair its battered image.
Meanwhile on Tuesday morning, EUR/USD appears to have given up some of its losses, last trading higher by 5 pips at 1.3566. So far today, the pair has traded in a range of 1.3436 to 1.3577. Short term support lies at 1.3424, with resistance at 1.3683.
If Greece manages to persuade the markets that its debt reduction plans are credible, look for the euro to bounce.
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