* Euro struggles on report Greece wants to amend EU deal
* Aussie rallies after RBA raises rates, signals more hikes
* Canadian dollar hits parity with U.S. counterpart
(Adds comment, details)
By Naomi Tajitsu
LONDON, April 6 (Reuters) - The euro fell broadly on Tuesday
after reports Greece wants to amend a European Union aid deal
highlighted Athens's deficit problems, prompting traders to dump
the European currency.
Media reports said Greece wanted to bypass an International
Monetary Fund financial contribution as part of an EU deal
struck last month and that Greek banks were being hit as big
depositors move cash overseas. []
"The euro has some serious issues and the Greece issue is
just not going away," said Maurice Pomery, managing director at
consultants Strategic Alpha.
However, demand for the higher-yielding Australian dollar
remained intact after the Reserve Bank of Australia raised
interest rates while the Canadian dollar hit parity versus the
U.S. dollar for the first time since mid-2008.
By 1130 GMT, the euro <EUR=> had fallen 0.5 percent to
$1.3417, and bumped down a full percent against the yen to
125.76 yen, its lowest in nearly a week, Reuters data showed.
Greece, however, denied it was seeking to renegotiate the
EU-IMF safety net agreement. []
European traders sold the euro on their return from Easter
holidays, helping to nudge the dollar 0.4 percent higher against
a currency basket <.DXY> to 81.446.
"There's speculation that the financial situation in Greece
will become increasingly difficult," said Lutz Karpowitz,
currency strategist at Commerzbank in Frankfurt. "Negative news
about Greece will continue to pressure the euro."
Greece needs to sell more bonds to meet its funding needs.
It has raised about 23 billion euros of a projected 2010
requirement of 53.2 billion euros. Late last month it announced
plans to sell a dollar bond at the end of April.
For an analysis of euro zone dollar issuance, see
[]
Concerns over high UK debt levels meanwhile weighed on
sterling. It lost 1 percent to $1.5130 <GBP=D4> as British Prime
Minister Gordon Brown called an election on May 6, heightening
political uncertainty. []
AUSSIE, CANADIAN DOLLAR
The Australian dollar <AUD=D4> rose 0.3 percent to $0.9259,
its highest since late January, after the central bank lifted
its key cash rate by 25 basis points to 4.25 percent and
suggested more tightening was to come. []
Gains in the Aussie helped the Canadian dollar <CAD=D4> break
parity with the U.S. dollar for the first time since July 2008,
rising to C$0.9999 per U.S. dollar.
The Canadian currency also benefited from higher oil prices
<CLc1>, which stayed close to an 18-month high of $86.90 per
barrel hit on Monday.
Still, the U.S. dollar was supported versus other currencies
after strong readings from the U.S. services sector and housing
market on Monday -- following a solid jobs report late last week
-- bolstered the view that the U.S. economy is improving.
Analysts said the market was also watching the yuan after
China on Tuesday defended its currency policy, saying it would
continue to refine it in a time and manner of its choosing.
[]
The comments from a Foreign Ministry spokesman came after
the United States last week said it would delay the release of
its bi-annual currency review, which markets had been
speculating may single out China as a currency manipulator.
(Additional reporting by Jessica Mortimer, editing by Nigel
Stephenson)
