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Dollar slips as support pledged for Greece

Published:Tuesday | March 9, 2010 | 12:00 AM

The United States (US) dollar slid versus the euro Monday after European leaders said they would back Greece through a debt crisis that has jeopardised the common currency.

The dollar was mixed against other currencies.

The 16-nation euro rose to US$1.3637 in midday trading from US$1.3624 late Friday. Meanwhile, the British pound dropped to US$1.5033 from $1.5157 but the dollar dipped to Japanese yen90.25 from yen90.38.

Greek Prime Minister George Papandreou met with German Chancellor Angela Merkel and French President Nicolas Sarkozy over the weekend.

Germany and France, Europe's biggest economies, both say they will help Greece through its budget problems, though they haven't provided more details.

Greece last week announced a savings package and held a successful bond sale to manage its huge debt load.

And on Monday, Portugal said it was planning to cut welfare benefits and government while selling assets and raising taxes in order to shore up its balance sheet.

Portugal wants to raise ?750 million (US$1.02 billion) in a bond issue later this week.

Greece and Portugal are among the countries whose large debt levels have hurt the euro in recent months, threatening the stability of the union of the 16 countries using the single currency.

The budget gaps and need for help from member nations have led the European Union to consider setting up a new European monetary fund to help support the euro.

In other trading Monday, the dollar slipped to 1.0726 Swiss francs from 1.0742 francs, and fell to CDN$1.0286 from CDN$1.0295.

- AP