World Forex : Euro falls as concern remains Ahead of Greek vote

The euro fell against the dollar and yen on Friday in Asia as investor concerns remained about the political outlook in Greece ahead of a planned confidence vote in the Athens parliament later in the day.

A referendum plan, the cause of the recent plunge in the euro, now seems to be abandoned. Still, Tokyo currency dealers said they cannot be relaxed about the nation's political conditions until they see how opposition lawmakers will respond to Prime Minister George Papandreou's call for cooperation.

Investors will pay attention to Greek parliament's confidence vote later in the global day, which would pave the way for a new coalition government at the cost of Papandreou's exit.

"Our understanding is a referendum won't take place, but the nation's political outlook remains uncertain as it remains unclear how opposition politicians will react to the recent political development," said Yuji Saito, director of the foreign-exchange department in Tokyo at Credit Agricole Corporate & Investment Bank. "It's hard to make an aggressive bet until the outcome is out."

As of 0450 GMT, the euro is at $1.3813 and Y107.78 from $1.3822 and Y107.92 in New York Friday.

Tokyo dealers said a part of reason behind the modest declines in the common currency was flows related to redemption of euro-zone nations' sovereign bonds. It's hard to imagine that investors would happily re-invest returned money to the European bonds at the moment, they added.

The dollar, meanwhile, was at Y78.00 from Y78.06 while the ICE Dollar Index, which tracks the U.S. dollar against a basket of currencies, was at 76.766 from 76.669.

Investors will pay attention to the U.S. non-farm payrolls data due later in the day to trade the greenback, dealers said. A Dow Jones poll of economists show the 1230 GMT data may show the number of workers has increased by 100,000 in October from September.

Barclays Capital chief currency strategist Masafumi Yamamoto said caution over Japan's intervention has been supporting the U.S. currency. But it may start edging down because passage of Japan's third extra budget, which includes a boost to Japan's remaining capacity to conduct intervention, is now likely to be delayed to Nov. 17.

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