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Euro soars to highs on hopes of Greek ‘yes’

The euro rose to a two-week high against the dollar today on hopes the Greek parliament will pass the cuts necessary for the release of further loans bailout in a crucial vote today.

Despite fears that the move is only a stop-gap measure to avoid a Greek default, hopes the vote would go through were boosted as Greek conservative opposition member Elsa Papadimitriou said she would vote in favour of the plan – going against her party’s stance.

This lifted the euro to $1.4449, a two week high.

Analysts said a positive outcome in the vote, which would allow international funding for Greece to be released and avoid a disorderly default, could push the euro towards $1.4500.

But Greece will still face massive headwinds even if the move is passed.

Tomorrow, the Greek parliament will vote on an implementation law to push through the fiscal measures in more detail if the first vote today passes.

If today’s vote fails to pass, the euro could fall sharply, analysts warned earlier.

Oil prices also gained on hopes the plan would be passed as did other currencies like the Japanese yen and the Australian dollar in markets that had opened early this morning.