EU focus: Euro rises, but debt concerns weigh

The euro was buoyant against the dollar on Wednesday after recovering from a seven-week low earlier in the week, but wariness over Europe's sovereign debt problems kept investors nervous about piling up euro positions.
The euro drew support from a recovery in oil prices and precious metals, while a downward trend in U.S. Treasury yields weighed on the dollar.
"The euro is still in a correction phase after recent declines. It has the potential to advance towards $1.43-$1.44 on hopes for more buybacks by foreign investors," said Hideki Amikura, a forex manager at Nomura Trust and Banking. "But the euro could lose ground again once rounds of corrective buying are over," Amikura said.

Still, investors are nervous as the region's debt crisis is far from over.
Europe's top financial officials broke a taboo on Tuesday and acknowledged for the first time that Greece may have to restructure its debt, which could stoke the region's sovereign debt crisis.
The euro drifted lower against the yen after gaining support in early trade on expectations of yen-selling flows linked to M&A deals by Japanese corporations.
Japan's Toshiba Corp is close to closing a deal to buy Swiss-based meter maker Landis+Gyr for about $2.5 billion, an industry source said on Tuesday.
Separately, Takeda Pharmaceutical will reach an agreement on Wednesday with Swiss-based Nycomed to acquire the company for about 1 trillion yen ($12 billion), the Nikkei financial daily reported. [ID:nWNAB9664]
U.S. housing starts and building permits fell in April, while factory output slumped, suggesting the economy got off to a weak start in the second quarter, U.S. data showed on Tuesday.
The New Zealand dollar advanced after news that producer input prices rose 2.2% in the three months to March 31 from the previous quarter, the sixth straight increase and the largest quarterly movement since September 2008.
The Aussie was undermined after Moody's Investors Service downgraded credit ratings of the country's four major banks to Aa2.