Forex: Tuesday’s review

Yesterday the euro strengthened against the dollar after a European Union official said a politically acceptable path will be sought for renegotiating Greece’s bailout conditions. Once a Greek government is formed, representatives of the so-called troika of the EU, International Monetary Fund and European Central Bank will travel to Athens and evaluate any requests for adaptations in the aid program, the official told reporters on condition of anonymity in Brussels today.

The U.S. currency fell against most of its major counterparts as the Federal Reserve starts a two-day meeting where 12 primary dealers expect some form of added stimulus from the central bank, while nine expect no action.  Fed policy makers gather amid speculation they will consider further stimulus measures to sustain U.S. growth. The Fed will review new forecasts at its two-day meeting as it contends with continuing financial stress in Europe and a U.S. unemployment rate that has remained above 8 percent for 40 consecutive months.

The pound weakened versus the euro after U.K. inflation slowed in May to the least in 2 1/2 years. U.K. consumer prices rose 2.8 percent in May from a year earlier, compared with a 3 percent increase in April, the Office for National Statistics said today in London. That’s the weakest since November 2009.