Investing.com - The euro held stronger in early Asia on Monday with Greek banks slated to open under some restrictions on withdrawls as markets in Japan are closed and no major data due.
EUR/USD traded at 1.0838, up 0.06%, while AUD/USD changed hands at 0.7376, up 0.06%. USD/JPY was quoted at 124.11, up 0.04%.
Greek banks are ready to open their branches across the country on Monday after a three-week shutdown, officials said at the weekend, while German Chancellor Angela Merkel called for swift aid talks so Athens could also lift withdrawal limits.
The cautious reopening of the banks, and an increase in value added tax on restaurant food and public transport from Monday, are aimed at restoring trust inside and outside Greece after an aid-for-reforms deal last week averted bankruptcy.
Greek Prime Minister Alexis Tsipras is trying to turn a corner after he reluctantly agreed to negotiate a third bailout, allowing the European Central Bank to top up bank credit lines but prompting a rebellion in his leftist Syriza party.
"Capital controls and restrictions on withdrawals will remain in place but we are entering a new stage which we all hope will be one of normality," the head of Greece's banking association Louka Katseli told Skai television.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, eased 0.04% to 98.06.
Last week, the U.S. dollar marched higher against most of its major rivals on Friday, as upbeat U.S. inflation and housing data added to expectations for an interest rate hike this fall.
Data on Friday showed that U.S. consumer prices rose 0.3% in June, the fifth consecutive monthly increase, while core prices, which exclude food and energy, increased 0.2% last month, adding to signs of firming inflation.
A separate report showed that U.S. housing starts surged 9.8% to 1.174 million units in June. Analysts had expected housing starts to increase by 6.2% last month.
Meanwhile, U.S. building permits jumped 7.4% to 1.343 million units in June, the most since July 2007, pointing to a rapidly strengthening housing market.
Federal Reserve Chair Janet Yellen said earlier in the week that the central bank was on track to raise interest rates by the end of the year if the economy continues to grow as expected.
Euro zone ministers agreed on Thursday to give Greece a €7 billion bridging loan from a European Union-wide fund to keep its finances afloat until a bailout is approved.
The news came after the ECB increased its emergency lending to Greek banks by €900 million and added that it is operating under the assumption that Greece will remain in the euro zone.
In the week ahead, market players will focus on U.S. data on home sales and jobless claims for further indications on the strength of the economy and the timing of an interest rate hike.
Manufacturing data from China, the euro zone and the U.S. will also be in focus. On Monday, Canada is to report on wholesale sales.