November 11, 2012 / 11:46 PM / 5 years ago

Euro rises as Greece approves budget law; Japan GDP awaited

TOKYO (Reuters) - The euro held above a two-month low in early Asian trading on Monday after Greece’s ruling coalition secured enough votes in parliament on Sunday to approve the 2013 budget law, but its gains were seen limited ahead of a meeting by euro zone finance ministers later in the session.

Deputies allied to Greece’s three-party government approved the budget with a comfortable majority of parliament’s 300 seats.

Euro zone finance ministers will meet in Brussels later in the session to discuss whether to release a new tranche of funding for the debt-plagued country. German Finance Minister Wolfgang Schaeuble told a German newspaper on Sunday that the troika of international lenders to Athens was unlikely to deliver its full report in time for Monday’s meeting.

The euro was likely to remain under pressure as investors hedged some of the risks associated with the November 16 Greece funding deadline, Richard Hastings, macro strategist at Global Hunter Securities, said in emailed comments.

“But we should emphasize that when it comes to distressed finance, deadlines are not as hard as they seem, and deals are surprisingly spontaneous at any moment,” Hastings added.

The euro was changing hands at $1.2733, up about 0.2 percent from late North American levels on Friday, when it fell as low as $1.2690 on the EBS trading platform. That was its lowest since September 7

Against the yen, it last stood at 101.16 yen, up 0.1 percent and moving away from a one-month low of 100.43 yen hit on Friday.

The dollar bought 79.45 yen, down slightly from late North American levels on Friday, when it fell as low as 79.07 yen, its lowest since October 18.

The greenback sagged under concerns about the so-called fiscal cliff of about $600 billion in expiring tax cuts and spending reductions due to take effect in January, unless the government can reach a deal to curb the deficit.

U.S. President Barack Obama said on Friday he was prepared to compromise with Republicans to avert the fiscal cliff, but he insisted any plan include higher taxes for high earners.

Investors awaited Japan’s gross domestic product report for the July-September quarter, which is expected to show a drop 0f 0.9 percent from the previous quarter for a 3.4 percent annualized contraction.

Japan’s Cabinet Office was scheduled to release the GDP report at 0850 JST (2350 GMT Sunday).

The Australian dollar was up about 0.1 percent at 1.0396, but still well shy of Wednesday’s 1 1/2-month high of $1.0480.

Reporting by Lisa Twaronite; Editing by Eric Meijer

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