* Euro falls on debt concerns; last week's low in sight
* Moody's places French bank ratings under review
* EUR/USD risk reversals show bets against EUR at 6-mth high
By Jessica Mortimer
LONDON, June 15 (Reuters) - The euro weakened on Wednesday, as euro zone ministers failed to reach agreement on how to tackle the Greek debt crisis and Moody's threatened large French banks with possible downgrades.
The euro looked poised to test last week's low against the dollar around $1.4320, with traders citing sovereign and macro fund selling above $1.4400.
The euro was down 0.4 percent at $1.4364
"I wouldn't expect the euro to fall very sharply. Positioning is a bit long euro/dollar but not extreme and we're unlikely to see a squeeze moving it rapidly lower," said Niels Christensen, currency strategist at Nordea in Copenhagen.
Euro zone finance ministers failed on Tuesday to reach agreement on how private holders of Greek debt should share the costs of a new bailout. [ID:nLDE75E03B]
Investor concerns were exacerbated as Moody's rating agency said it was reviewing the ratings of BNP Paribas SA, France's biggest bank, Societe Generale SA and Credit Agricole SA due to their exposure to Greek debt. [ID:nL3E7HF0A4].
The single currency was also hurt by a Financial Times report that the German-inspired Greek debt rescheduling plan could force euro zone governments to provide up to an extra 20 billion euros for the financial sector. [ID:nWNA1032]
"The problem is not the fact that Greece is likely to face some form of a default. The problem is that the debate over the involvement of private investors in the rescue scheme drags on, making market participants jittery," said Teppei Ino, a currency analyst at Bank of Tokyo-Mitsubishi UFJ.
The euro came off a high hit in Asian trade of $1.4451 on EBS trading platform after Tuesday's better-than-expected U.S. retail sales and Chinese inflation data boosted risk appetite.
The single currency was steady against the safe-haven Swiss franc at 1.2204 francs
BOLSTERING BEARISH BETS
The debate over Greece's rescue prompted hedge funds to bolster bearish bets on the single currency via put options as they expected more negative headlines in coming days.
Risk reversals show increasing demand for bets on a lower euro against the dollar. The 25 delta one-month euro/dollar risk reversal
"They have been buying substantial amounts of long-term euro put options," a trader at a Japanese bank in Tokyo said, adding strikes were at around $1.40 with tenors of one to two months.
"Funds seem to be positioning to buy back the greenback."
The dollar index <.DXY>, which tracks its performance against a basket of currencies, was up 0.5 percent at 74.701.
But dollar gains were limited by concerns over lawmakers and officials failure to lift the U.S. debt ceiling.
U.S. Federal Reserve chairman Ben Bernanke warned the United States could lose its AAA credit rating while the dollar's status as a reserve currency could be damaged if there was no quick resolution on raising the debt limit. [ID:nN14186233]
The dollar was up 0.2 percent at 80.60 yen
The Australian dollar
(Additional reporting by Antoni Slodkowski in Tokyo)