“There is uncertainty regarding the debt buyback,” said Gavin Friend, a London-based currency strategist at National Australia Bank Ltd. “It looks as though Greece wants to pursue a buyback at some point between now and Dec. 13. We don’t quite know how much that’s going to contribute and it looks as though the IMF is saying part of the deal is contingent upon the success of that buyback.”
The euro has fallen 2.3 percent this year, the second-worst performer among the 10 developed-market currencies after the yen, according to Bloomberg Correlation-Weighted Indexes. The yen has weakened 9 percent and the dollar has lost 2.1 percent.
Greek Finance Minister Yannis Stournaras said the decision “keeps Greece in the euro.”
The euro erased an earlier advance after Federal Reserve Bank of Dallas President Richard W. Fisher said accommodative policies can’t be left in place forever and limits should be set on U.S. stimulus known as quantitative easing, boosting demand for the U.S. currency.
The Dollar Index, which IntercontinentalExchange Inc. uses to track the greenback against currencies of six U.S. trading partners, added 0.1 percent to 80.315 after falling as much as 0.3 percent. It rose after bookings for non-defense capital goods excluding aircraft rose 1.7 percent last month, the most since May, the Commerce Department reported, signaling companies are starting to overcome concern the looming fiscal cliff will derail the U.S. economy.
Lawmakers are trying to avert the fiscal cliff, a collection of $607 billion in automatic tax increases and spending cuts scheduled to take effect at the beginning of 2013 unless lawmakers take action, to prevent a short-term shock to the economy and reach an agreement on long-term deficit reduction.