The Euro to Pound Sterling (EUR/GBP) and Euro to US Dollar (EUR/USD) exchange rates softened on Wednesday as fears over Greece continued to weigh upon the single currency.
The Euro to Pound Sterling (EUR/GBP) exchange rate touched a session low of 0.7062
With the G7 finance ministers meeting due to be held this week in Dresdan, pressure on the EU and Greece to come to some sort of settlement will increase.
The United States is rapidly losing patience with both sides and Treasury Secretary Jack Lew has called on both sides to resolve the crisis quickly before it gets out of control and further impacts the global markets.
‘Progress has been made, but not enough for it to be resolved. In addition, there is always another deadline approaching. Brinkmanship is a dangerous thing when it only takes one accident. Everyone has to double down, and treat the next deadline as the last deadline and get this resolved. The risk of going from deadline to deadline only increases the risks of an accidental Greek exit,’ Lew said to an audience at the London School for Economics.
The European Central Bank meanwhile has left Greece’s emergency liquidity limit unchanged at the current level of €80.2 billion.
Also weighing on the Euro was a report, which showed that worried Greeks withdrew €300 million from their bank accounts on Tuesday, raising concerns that withdrawals will increase the closer June 5 gets.
Earlier in the session, the Euro had managed to claw back some of the losses it suffered on Tuesday as economists fears were eased by rhetoric from Athens and Brussels that a deal will be reached before the June 5 deadline.
The Greek government said that it was confident that it would be able to repay the €305 million it owes the International Monetary Fund (IMF) on June 5.
Greek officials are set to resume negotiations in Brussels with the country’s creditors later Wednesday.
The Euro to US Dollar (EUR/USD) exchange rate touched a session low of 1.0862
The US Dollar continued to receive support from the release of Tuesday’s mostly positive data releases.
The data showed that US business investment increased house prices rose and consumer confidence increased.
The positive reports increased speculation that the Federal Reserve will choose to start raising interest rates later in the year.