* Euro inches up vs dlr but still weak; Greece worries weigh
* Euro recovers from earlier 9-month low vs Swiss franc
* SNB intervention jitters remain
* No sign of a build-up in dollar long positions
(Updates prices)
By Jessica Mortimer
LONDON, Dec 21 (Reuters) - The euro edged up against the
dollar in thin, pre-holiday trade on Monday, but it stayed weak
and close to recent lows, weighed down by lingering concerns
about the fiscal health of Greece.
The single currency recovered against the Swiss franc after
tumbling to a nine-month low overnight when traders took
advantage of thin liquidity to push it quickly through stops
below 1.49 Swiss francs.
Investors have been testing the resolve of the Swiss
National Bank after it subtly altered its intervention stance
earlier this month, saying it would act only to counter an
"excessive" appreciation of the franc versus the euro.
But jitters remain about the chances of intervention. In
earlier trade, the franc fell sharply against the dollar and the
euro, with traders saying a large dollar/Swiss franc buy order
by a commercial bank triggered unconfirmed talk of SNB action.
The SNB and Bank for International Settlements, which has
acted for the SNB in the past, declined comment.
"Euro/Swiss has reached quite low levels and it could be an
indication that the SNB is not targeting specific levels as
such," said Sverre Holbek, Danske Bank strategist in Copenhagen.
"This may allow the currency to slip a bit further than
we've seen previously, but we still don't think they are ready
to abandon their intervention in the currency market just yet."
At 1240 GMT, the euro was steady at 1.4939 francs <EURCHF=>.
It had earlier crashed through stops below 1.4900 francs to hit
a nine-month low of 1.4826 on trading platform EBS.
Against the dollar, the euro edged up 0.1 percent at $1.4354
<EUR=>, helped by rising European shares, but it stayed close to
Friday's low of $1.4262 on EBS, its weakest since Sept. 4.
The euro has fallen sharply from levels above $1.50 as
recently as Dec. 4, pressured by concerns about the fiscal
health of some countries on the euro zone periphery following
recent rating agency downgrades on Greek debt.
The European Commission said on Monday the euro was
overvalued and that its further appreciation could hit the more
open economies in the euro zone. []
Meanwhile, solid figures on the U.S. job market and retail
sales earlier this month have prompted talk the U.S. economy may
recover faster than the euro zone.
"It looks like we may be seeing better growth prospects in
the U.S. than the euro zone. Better employment and retail sales
data in the U.S. has raised the possibility of a cyclical
recovery in 2010," ING currency strategist Chris Turner said.
DOLLAR MOMENTUM TO CONTINUE?
The dollar index <.DXY>, which measures its performance
against six other major currencies, dipped 0.2 percent to
77.665, though it was still not far from a more than three-month
high of 78.141 hit on Friday.
Ahead of the year-end, the dollar has been supported as
investors cut back on short dollar positions, though some
traders said the U.S. currency's gains could begin to slow as
many of these positions have already been neutralised.
U.S. Commodity Futures Trading Commission data on Friday
showed speculators cut bets against the dollar to their lowest
in more than 10 months in the week ending Dec. 15. []
"It will be key to see what happens when the calendar turns
to 2010 to see if we see a build-up in long dollar positions,"
Holbek said, adding there had been no sign of this so far.
"We don't see that because it still is a very low-yielding
currency and we have no indications from the Fed that they are
going to change their quite dovish stance just yet".
The higher-yielding Australian dollar fell 0.6 percent
against the U.S. dollar to $0.8857 <AUD=D4>, close to a 10-week
low hit on Friday as market players continued to scale back
expectations for how high Australian rates will rise next year.
(Additional reporting by Satomi Noguchi in Tokyo)
