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Tokyo - The euro eased in Asian trade on Tuesday, hours before a debt repayment deadline that Greece is expected to miss, putting it in default and fanning fears it will crash out of the eurozone.
The since currency bought $1.1190 in Tokyo afternoon trade against $1.1247 in New York late on Monday. It also fell to ¥136.90 on Tuesday from ¥137.82.
It had rallied from an almost one-month low on Monday on news reports that German Finance Minister Wolfgang Schaeuble said he did not view Greece as a contagion risk for the rest of the eurozone.
"Right now the biggest surprise is that the euro is not materially weaker," said Matthew Sherwood, head of investment markets research in Sydney at Perpetual.
"Market expectations are that the Greek situation is manageable even if they exit the union," he said in a client note.
Greek Prime Minister Alexis Tsipras stunned the world at the weekend by calling for a July 5 referendum on austerity measures demanded by its creditors in exchange for bailout funds.
READ: Greece to hold referendum on austerity demands
On Monday, Tsipras implied Athens would default.
"(How) is it possible the creditors are waiting for the IMF payment while our banks are being suffocated?" he asked in a television interview. "Once they decide to stop the suffocation, they will be paid," he added.
The dollar inched down to ¥122.33 from ¥122.55.
A Capital Economics analysis said the Greek government's referendum plan "has elevated the crisis to a higher level".
"While the latest opinion polls point to a 'yes' vote, we suspect that Greek people may ultimately vote 'no' when faced with the pension cuts etc. that this requires," it said.
"And they may not even get that far if the expiry of the bailout and failure to repay the IMF today result in the ECB cutting off emergency liquidity assistance for Greek banks.
"Either way, we think that the risk of a near-term Grexit has probably risen above 50%," it said.
The dollar was lower against other Asia-Pacific currencies.
It eased to Tw$30.87 from Tw$30.97 on Monday, to 13 320 Indonesian rupiah from 13 349 rupiah, and to 33.77 Thai baht from 33.86 baht.
It also declined to 63.77 Indian rupees from 63.85 rupees, to Sg$1.3475 from Sg$1.3525, to 1 118.68 South Korean won from 1 122.44 won, and to 45.13 Philippine pesos from 45.18 pesos.
The Australian dollar gained to 76.70 US cents from 76.50c, while the Chinese yuan eased to ¥19.71 from ¥19.72.
