BISINISS WORLD NEWS

TOKYO: The euro was mixed in Asian trade Monday as cautious investors mulled reports that a bailout plan for debt-ridden Greece was in the works.

The euro slid to 1.3604 dollars in Tokyo noon trade from 1.3626 in New York late Friday. But it firmed to 121.22 yen from 121.03. The dollar rose to 89.09 yen from 88.81.

The euro had jumped in earlier trade on reports that France and Germany may offer guarantees on newly-issued Greek debt to encourage investment, before falling back, dealers said.

Barclays analysts said in a client note: "we caution that it is early days for these proposed solutions, so any positive impact on the euro is still subject to the ebb and flow of the politics surrounding them."

Investor sentiment towards Greece will be tested when the country plans a sale of as much as five billion euros of 10-year bonds this week, NAB Capital strategist John Kyriakopoulos said.

The European Union's economic supervisor Olli Rehn was set to begin Monday a visit to Greece to inspect the debt-hit nation's efforts to slash massive debt and deficit that have rattled the single currency.

The Greek Socialist government has presented a raft of measures designed to cut state spending, boost tax revenue and combat long-standing fiscal mismanagement.

Greece's deficit is over four times the allowed EU limit, at 12.7 percent of gross domestic product.

The Socialist government has pledged to cut the deficit by four percentage points to 8.7 percent this year, but there are widespread concerns that the recession-hit country will fail to meet the target.

If the programme proves insufficient, a meeting of EU finance ministers could demand further corrective action at a meeting on March 16.

Investors also awaited US data this week including manufacturing data later Monday and a key monthly employment report on Friday for indications of the pace of recovery in the world's largest economy.