Dollar at two-month high

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LONDON: The dollar hit a two-month high against a basket of currencies on Wednesday on expectations the Federal Reserve will raise rates in the near term, but it gave up gains against the euro on relief that there was progress in Greek bailout talks.

Euro zone finance ministers early on Wednesday gave a nod to releasing 10.3 billion euros in new funds for Greece in recognition of painful fiscal reforms pushed through by Prime Minister Alexis Tsipras´s leftist-led coalitionThe dollar index was flat at 95.536, after rising as high as 95.661 earlier in the Asian session, its highest since late March.

The index has risen nearly 3 percent this month, with the latest move coming after data showed new U.S. single-family home sales surged to a more than eight-year peak in April and prices hit a record high.  The euro was up 0.15 percent higher at $1.1152, recovering from a 10-week low of $1.1133 struck on Tuesday.  The single currency was also higher against the yen and the British pound as southern European government bonds rallied on the Greek news.  "The Greek debt problem was not the biggest concern, but there is relief it is out of the way and euro is drawing some support from that," said Niels Christensen, FX strategist at Nordea.