Dollar gains on Greece concerns

By Blake Ellis, staff reporter


NEW YORK (CNNMoney.com) -- The dollar gained Tuesday as investors worried that an agreement on a rescue package for Greece would not be reached at this week's European Union summit.

What prices are doing: The dollar rose 0.4% versus the euro to $1.3506 and climbed 0.37% against the British pound to $1.5044. Against the Japanese yen, the dollar edged up 0.26% to ¥90.37.

chart_ws_currency_usd_eur.03.png

On Monday, the dollar pared earlier gains as stocks rebounded following the House vote to approve health care reform.

What's moving the market: The euro slipped against the dollar in earlier trading following reports that European Central Bank President Jean-Claude Trichet said he opposed offering Greece low interest loans and German Chancellor Angela Merkel said investors shouldn't expect this week's summit to result in an aid package for Greece.

If a sufficient aid package isn't offered to Greece, Prime Minister George Papandreou said he will turn to the International Monetary Fund for assistance.

News reports Tuesday said that German and French leaders had already agreed to let Greece turn to the IMF for help, causing the euro to plunge.

As investors awaited the summit of European Union leaders on Thursday, a government report on the U.S. housing market was the center of attention Tuesday.

The National Association of Realtors said existing home sales fell to an annual rate of 5.02 million units in February, slightly better than expected.

Economists surveyed by Briefing.com had predicted sales to have edged lower to an annual rate of 5 million units last month, from 5.05 million in January.

What analysts are saying: Greece's debt crisis has helped lift the dollar over the past month or so, and the euro will likely remain under pressure until a detailed fix is found, said Meg Browne, a senior currency strategist at Brown Brothers Harriman.

"A solution could provide some temporary relief," she said. "But ahead of the summit, the question is, will it really help Greece in the long run? The proof will come with time and as Greece continues to address its problems, but there are other countries as well that have issues, so does a solution apply to them as well?"

Browne said she expects the dollar to continue to gain strength against the yen and pound over the course of the year.

However, the dollar's rise may be hindered if the U.S. economy shows signs of a lagging recovering. If unemployment fails to stabilize or the housing market remains weak, the dollar could be knocked lower, she said.  To top of page

Frontline troops push for solar energy
The U.S. Marines are testing renewable energy technologies like solar to reduce costs and casualties associated with fossil fuels. Play
25 Best Places to find rich singles
Looking for Mr. or Ms. Moneybags? Hunt down the perfect mate in these wealthy cities, which are brimming with unattached professionals. More
Fun festivals: Twins to mustard to pirates!
You'll see double in Twinsburg, Ohio, and Ketchup lovers should beware in Middleton, WI. Here's some of the best and strangest town festivals. Play
Overnight Avg Rate Latest Change Last Week
30 yr fixed3.95%4.15%
15 yr fixed3.05%3.11%
5/1 ARM3.71%3.19%
30 yr refi4.03%4.19%
15 yr refi3.11%3.17%
Rate data provided
by Bankrate.com
View rates in your area
 
Find personalized rates:
Index Last Change % Change
Dow 16,337.54 -42.87 -0.26%
Nasdaq 4,286.05 27.61 0.65%
S&P 500 1,892.99 6.23 0.33%
Treasuries 2.17 -0.03 -1.46%
Data as of 10:24am ET
Company Price Change % Change
Apple Inc 99.13 1.46 1.49%
Bank of America Corp... 16.23 0.02 0.12%
Facebook Inc 76.32 0.37 0.49%
International Busine... 168.65 -13.40 -7.36%
Cisco Systems Inc 22.82 -0.43 -1.85%
Data as of 10:10am ET

Sections

An elite group of forty Porsche enthusiasts were treated to a private tour of the Sistine Chapel on Saturday -- the first corporate charity event ever held there. More

Detroit has 80,000 dilapidated properties and 100,000 empty lots. It's trying to get more people like Antjuan Wyatt to buy them. More

Facebook wants the DEA to stop hijacking identities and creating fake accounts for its investigations. More

Host a furniture market. Here's how small town High Point, N.C. rakes in this much money -- twice a year. More

Detroit has 80,000 dilapidated properties and 100,000 empty lots. It's trying to get more people like Antjuan Wyatt to buy them. More

Market indexes are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer Morningstar: © 2014 Morningstar, Inc. All Rights Reserved. Disclaimer The Dow Jones IndexesSM are proprietary to and distributed by Dow Jones & Company, Inc. and have been licensed for use. All content of the Dow Jones IndexesSM © 2014 is proprietary to Dow Jones & Company, Inc. Chicago Mercantile Association. The market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. FactSet Research Systems Inc. 2014. All rights reserved. Most stock quote data provided by BATS.