Higher Dollar Powers on the new Euro zone fears

- Euro affected by the lack of progress by the ministers in the debt crisis

- South Korea, Indonesia to intervene to defend their currencies

- The eyes of the Fed, the IMF, the BRIC meetings this week

By Martin Vaughan and Gaurav Raghuvanshi

Dow Jones Newswires

SINGAPORE - (Dow Jones) - The dollar rose against the euro and other currencies sensitive to risk, on Monday, when the failure of European authorities to show progress in containing the crisis in the euro zone debt weakened appetite risk.

Authorities in South Korea and Indonesia were suspected of selling dollars to halt slide of their currencies as risk aversion fueled the outputs of the emerging markets. The Korean won was at its lowest level in nearly six months, while the Singapore dollar also fell to a minimum of five months.

With Tokyo markets closed for a national holiday and little in the timing of the data for Asia, market players stuck to the disappointing news of the weekend meeting of European finance ministers in Wroclaw, Poland.

"It still sounds like there is little coordination among EU leaders to resolve the crisis," said quarterback Mike Burrowes BNZ in Wellington.

The ministers warned that can hold the next leg of the Greek aid, EUR 8 million due in October, if Athens does not take decisive action. The Greek Prime Minister George Papandreou, canceled a trip to the U.S. perform crisis meetings, continues on Monday, but the Finance Minister Evangelos Venizelos said it is "threatened and humiliated" by the demands of the EU, the IMF and the ECB.

A setback for the weekend, German Chancellor Angela Merkel, as a member of his government coalition, the Free Democrats, was crushed in elections in Berlin, also feeds on the weak euro and added to general caution in the currency markets.

Dealers see up close a meeting on Tuesday and Wednesday of the U.S. Federal Reserve for signs of further expansion, which could eat into profits in the dollar and the risk of past support.

"Overall, the week starts with nervousness and probably how to be a week the risk of closure unless the Fed will give a much needed boost to confidence," said Mitul Kotecha, head of global FX strategy at Credit Agricole in a note.

The meetings start later this week the International Monetary Fund, the Group of Seven and the Group of 20 also will be watched closely by efforts to support the euro area - in particular the BRIC emerging powers Brazil, Russia, India, China and South Africa.

The euro was at $ 1.3673 at 0631 GMT, compared with $ 1.3802 late Friday in New York. The yen was stable at low volumes, Tokyo traders absent. The dollar was at Y76.87 in Asia, little changed from Y76.82 late Friday.

The pound was U.S. $ 1. 5699 after falling to a minimum of eight months of 1.5685 $ 1.5790 Friday. The Australian dollar was at $ 1.0231 from $ 1.0362 in New York on Friday.

Interbank Foreign Exchange Rates At 01:50 EST / 0550 GMT

Latest Previous %Chg Daily Daily %Chg
Dollar Rates Close High Low 12/31


USD/JPY Japan 76.90-92 76.91-97 -0.04 76.98 76.88 -5.19
EUR/USD Euro 1.3658-60 1.3691-95 -0.25 1.3711 1.3648 +2.00
GBP/USD U.K. 1.5699-702 1.5730-36 -0.21 1.5749 1.5686 +0.59
USD/CHF Switzerland 0.8825-30 0.8804-14 +0.21 0.8832 0.8802 -5.59
USD/CAD Canada 0.9838-44 0.9789-92 +0.52 0.9845 0.9792 -1.07
AUD/USD Australia 1.0224-28 1.0367-70 -1.37 1.0368 1.0214 -0.08
NZD/USD New Zealand 0.8220-26 0.8292-98 -0.86 0.8292 0.8220 +5.47
EUR/JPY Japan 105.02-06 105.26-41 -0.28 105.46 104.98 -3.31

--By Martin Vaughan, Dow Jones Newswires; +65 6415 4033; martin.vaughan@
dowjones.com