* Relief over Greek aid turns to caution
* Greek T-bill auction details awaited after 0900 GMT
* Analysts say structural issues to hit euro long-term
(Adds quote, detail, changes dateline previous TOKYO)
By Neal Armstrong
LONDON, April 13 (Reuters) - The euro steadied against the
yen and dollar on Tuesday, paring overnight losses racked up as
relief over Greece's aid package turned to caution, as investors
awaited a Greek Treasury Bill sale to gauge appetite for risk.
The euro climbed to its highest level in nearly a month
against the dollar on Monday, after euro zone finance ministers
agreed on a financial aid package for Greece, before paring
gains as investors sought clarification about the plan.
Traders were watching for Greece's sale of 1.2 billion euros
of Treasury Bills, with results due after 0900 GMT, to meaure
investor appetite for risk in the wake of the Greek aid package.
"If the auction should go well, that will lend support to
the euro in the short-term, but in the longer term questions
remain over structural changes required so I expect the euro
recovery to be short-lived," said Antje Praefcke, currency
analyst at Commerzbank.
At 0755 GMT, the euro was trading close to flat versus the
dollar <EUR=> at $1.3590 after hitting a near one-month high of
$1.3691 on Monday.
The Greek aid package had reduced near-term default risk
which analysts said could lead to a positive T-bill auction.
"As the default risk over the next 12 months has fallen
substantially following the EU statement, Greece should be able
to raise at least the planned amount, possibly more," said
Barclays analysts in a note.
Versus the yen <EURJPY=R>, the euro recovered Asian losses
to trade up 0.1 percent at 126.85 yen after a draft from Japan's
ruling party put the Japanese currency under pressure.
The draft suggested the dollar <JPY=> should be kept around
120 yen. This pushed the greenback to the day's high at 93.42
yen. []
The dollar fell to its lowest in two weeks against the yen
overnight as Asian stocks slipped, while some said a report that
the Bank of Japan may slightly revise up its consumer price
forecast for the next fiscal year also helped the yen.
BOJ Governor Masaaki Shirakawa later said annual consumer
price falls were expected to narrow as the output gap shrinks
but also that the central bank did not rule out any policy
option. []
The yen remained sensitive to market expectations on the
Chinese yuan. Chinese President Hu Jintao told U.S. President
Barack Obama Beijing would "firmly stick" to its own path for
reforming the yuan's exchange rate, the official Xinhua news
agency said.
Hu added the yuan's gains would neither balance Sino-U.S
trade, nor solve the U.S. unemployment problem. []
(Additional reporting by Kaori Kaneko; editing by Nigel
Stephenson)
