TOKYO, May 21, 2012 (AFP) - The euro gained ground in Asia on Monday, after hitting four-month lows against the dollar in New York as traders pushed down the currency on fears that Europe's fiscal troubles are far from over.
The euro strengthened to $1.2810 in Tokyo morning trade, from $1.2773 in New York late Friday.
Earlier Friday, the unit hit a four-month low of $1.2642, underscoring worries over Spain's weakening banking sector and a possible Greek exit from the 17-nation eurozone.
On Monday, the euro also rose to 101.40 yen from 100.94 yen, while the dollar advanced to 79.14 yen from 78.95 yen.
The euro's rebound came after leaders at a G8 summit in the United States at the weekend called for Greece to stay in the eurozone as they debated deep divisions about how best to tackle Europe's fiscal woes.
The dollar's rise against the yen may be limited with little positive economic data expected, dealers said.
Traders are now "focusing on the impact of (the) Greek economic and financial situation... on its domestic politics," Masafumi Yamamoto, chief currency strategist at Barclays Capital, said in a note to clients.
Greeks will not only be electing lawmakers in elections next month but voting on whether their country stays in the eurozone, German Finance Minister Wolfgang Schaeuble said Sunday.
"Europe is ready to help the Greek people... But Europeans can't do the work that Greece must do, that depends on the Greeks," he told the Sunday edition of Greek daily Kathimerini.
"Greek voters won't be voting only for a party next month. They will also vote on existential questions and it is important that their choice takes into everything into account," he added.
May 6 polls saw Greek anti-austerity parties gain ground, casting doubt on Athens' promised reforms and raising questions for Greece's creditors over whether to ease up on austerity demands or cut off rescue funds.
The latter course could lead to a Greek default and exit from the eurozone, sparking global panic, and tensions are rising ahead of the new polls.
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