* Uncertainty about Greek aid weighs on euro
* Germany wants to bundle Greek aid - source
* Weak ZEW data highlights problems facing Germany
* Fears about U.S. "fiscal cliff" favor dollar
By Julie Haviv
NEW YORK, Nov 13 The euro slumped to its lowest
level against the dollar in over two months on Tuesday on
disappointment over a delay in aid to debt-stricken Greece and
worries about a U.S. fiscal crisis.
The euro has lost value against the safe-haven dollar in
seven of nine trading sessions in November, notching roughly a 2
Greece's international lenders gave the country more time to
fix its budget, though they didn't disburse the aid Greece had
hoped to use to refinance 5 billion euros of its debt pile by
The euro briefly rose after a German government source said
European countries deliberating on payments to Greece could
bundle several tranches together into a single payment of more
than 44 billion euros.
But the euro remained vulnerable to uncertainty over funding
for the debt-stricken country. Asked about the report, a German
finance ministry spokeswoman said no final decision had been
made on Greek loans.
"There is quite a long list of worries at the moment, with
the overall backdrop risk-negative," said Vassili Serebriakov,
fx strategist at BNP Paribas in New York.
"There is no Greece resolution and it looks like some of the
critical details for receiving more aid have been pushed to the
end of this month," he said. "It is also unclear if Spain will
request a bailout and on top of that we have a looming U.S.
Eurogroup Chairman Jean-Claude Juncker said on Monday the
ministers would meet again on Nov. 20, though officials said
more talks could be needed the following week to cement a deal.
The euro should gain if Spain requests a bailout because it
would set the stage for the European Central Bank to buy its
debt to lower its borrowing costs.
The euro was last down 0.1 percent at $1.2694,
having earlier dropped to $1.2660, its lowest since Sept.
7, in reaction to an inconclusive euro zone finance ministers'
meeting and weak German data.
A weak German ZEW sentiment survey heightened concerns about
the impact of the euro zone crisis on Europe's largest economy
and knocked the euro.
"If there are signs that Greece could get a disbursement
before they run dry of money that would give the euro a boost,"
said Dag Muller, technical analyst at SEB.
But he said the euro could stall ahead of chart resistance
around $1.2850-$1.2900. SEB forecast the euro would rise to
$1.32 by the end of the year, although Muller said this was
conditional on Greece getting the funding it needs.
Finance ministers said Greece should be given until 2022 to
lower its debt to GDP ratio to 120 percent, but International
Monetary Fund chief Christine Lagarde insisted the existing
target of 2020 should remain.
BNP Paribas' Serebriakov said the euro could fall to $1.26,
but believes it should rise by the end of the year.
"Once all of the market uncertainties are resolved the euro
could easily rise above $1.30 and we expect the euro to hit
$1.35 by the end of the year," he said.
Under the terms of its second bailout program, Greece was
due to receive 31.2 billion euros by the end of June, plus an
additional 5 billion by the end of September and 7.2 billion
euros by the end of December.
The source in Germany said these three payments could be
combined to avoid stoking uncertainty with further deliberations
on tranches in the coming weeks and months.
The lack of a fresh aid payment meant Greece had to roll over
short-term borrowing. It sold 4.062 billion euros of treasury
bills on Tuesday, not enough to finance a 5 billion issue
maturing on Friday.
The safe-haven U.S. dollar has been buoyed by worries over
the U.S. "fiscal cliff," a series of massive budget cuts and tax
hikes that will take effect if Congress cannot agree on a deal
by the end of the year.
The dollar index was up 0.1 percent at 81.128, having
earlier hit a two-month high of 81.241.
Against the yen, the dollar was flat at 79.48,
according to Reuters data.