By William L. Watts, MarketWatch
LONDON (MarketWatch) -- The U.S. dollar was flat to slightly higher versus major rivals Tuesday, while the European single currency failed to follow through on an earlier rebound tied to waning worries about Greece.
The euro had rebounded sharply from near a nine-month low on Tuesday after European Union finance ministers gave Greece a month to show its budget-cutting efforts were bearing fruit.
The euro changed hands at $1.3724 in recent action, down slightly from $1.3768 in late North American trading on Tuesday.
The ministers warned Athens it would have tougher budget cuts imposed on it unless it showed signs of progress toward meeting its targets for slashing the deficit from nearly 13% of gross domestic product last year. Read about finance ministers' pressure on Greece.
The warning followed a vague pledge by European Union leaders last week to ensure Greece wouldn't default on its debt obligations.
"It is possible that an immediate crisis for [European economic and monetary union] has been sidestepped," said Jane Foley, research director at Forex.com. "However, in terms of structural reform, one month is a drop in the ocean; budget reform will take years."
Uncertainties surrounding Greece's budget and pressures on the euro are likely to re-emerge eventually, she said.
The dollar index (DXY 79.81, +0.11, +0.14%) , which tracks the greenback against a trade-weighted basket of six major currencies, rose to 79.835, up slightly from 79.634 late Tuesday.
The dollar rose versus the Japanese currency to trade at 90.65 yen, up from 90.10 yen late Tuesday.
The British pound slipped 0.1% versus the U.S. dollar to trade at $1.5760.
Minutes released Wednesday from the Bank of England Monetary Policy Committee's monthly meeting earlier this month showed the panel's decision to pause its 200 billion pound ($313.5 billion) money-printing, quantitative-easing program was unanimous.
At the same time, data released by the Office for National Statistics showed the number of persons claiming unemployment benefits jumped unexpectedly by 23,500 in January. Read about the BOE decision and the unemployment data.
The pound initially bounced on the BOE minutes but upside was limited by the jobs figures, said Boris Schlossberg, director of currency research at GFT.
"The news suggests that labor conditions in the U.K. economy remain challenging and are likely to put a damper on growth for the foreseeable future leaving the BOE stationary for all of 2010 and perhaps beyond," Schlossberg said.
