* Greek worries remain key market focus
* Focus on EU summit next week to see if Greece gets aid
* Euro/Swiss tumbles to 17-month low
(Adds comment, updates throughout)
By Gertrude Chavez-Dreyfuss
NEW YORK, March 19 (Reuters) - The euro fell against the
dollar on Friday, pressured by persistent worries about
Greece's debt problems as traders waited to see if the country
can secure aid from euro zone members at a summit next week.
The euro zone currency, on track for its worst weekly
performance since late January, had also weakened on Thursday
after a report that Greece saw limited prospects for assistance
from euro zone partners. That heightened uncertainty about
whether the country will be able to service its debts.
"Clearly, the Greece issue hasn't gone away. And the whole
issue of introducing the IMF to the mix, while structurally may
be the right situation, really puts the whole monetary union in
question," said Boris Schlossberg, director of FX research at
GFT in New York.
Greece said on Thursday it could not achieve promised
deficit cuts if borrowing costs remained high, and might have
to turn to the International Monetary Fund. []
But it dismissed a report it was planning to turn to the
global lender as soon as early April if EU leaders do not agree
on a rescue plan next week.
"Greece is doing all the right austerity measures, but it
is paying 300 basis points above German bunds and that's just
not possible. So it's creating an untenable conflict among the
members," Schlossberg said.
The premium investors demand to buy 10-year Greek
government bonds over German benchmarks continued to rise on
Friday. [].
In early New York trading, the euro <EUR=> slipped 0.4
percent on the day to $1.3551 after hitting its lowest in more
than a week at $1.3534, according to Reuters data.
The euro <EURCHF=> was down 0.2 percent against the Swiss
franc to trade at 1.4364. Earlier it fell to 1.4320 francs, its
weakest since October 2008 in the aftermath of hawkish comments
from a Swiss National Bank official.
SNB board member Jean-Pierre Danthine said on Thursday
Swiss firms and consumers should prepare for rising borrowing
costs and exchange rates determined by the market as interest
rates could not stay low forever. []
"The Danthine comments have encouraged speculators to buy
Swiss francs. I can foresee a move towards 1.3500," said Chris
Turner, head of FX strategy at ING in London.
Traders are focusing on the 1.4300 area, the record low, as
the next support level. Options structures were said to be
prevalent at that level.
The SNB's statement last week made no change to its pledge
to counter excessive gains in the franc as it continues to
appreciate against the euro.
The dollar was broadly supported, edging up 0.4 percent
against a currency basket to 80.543 and traded at 90.64 yen
against the Japanese currency <JPY=>, up 0.3 percent on the
day.
Sterling slipped 0.6 percent versus the dollar <GBP=D4>,
weighed by remarks from Bank of England policymaker Andrew
Sentance, who said there was some risk of a double-dip
recession in the UK. []
The Canadian dollar, meanwhile, was boosted after Canadian
core inflation unexpectedly rose in February. [].
It hit a fresh 20-month high hit on Wednesday versus the U.S.
Dollar <CAD=D4> at C$1.0063.
(Additional reporting by Naomi Tajitsu in London; Editing by
Chizu Nomiyama)
