The 19-nation euro fell as much as 1.9 percent to $1.0955, its lowest level in almost a month, in early trade in Tokyo on Monday. Against the yen, the common currency dropped more than 3 percent to 133.80 yen, a five-week low. The Swiss franc added 1 percent versus the euro, while the UK pound rose 1.1 percent.

Financial analysts reacted to the Greek government's decision to call a referendum on July 5 on its bailout deal as an escalation in the country's financial crisis.

The European Central Bank froze the level of emergency aid available to Greek banks on Sunday.

The announcement of bank closures in Greece for Monday and a limit of 60 euros ($66) for withdrawals from ATM cash machines when they reopen was made on Sunday. It increased concerns of a default and risk that Greece would leave the eurozone.

Greece’s finance ministry announced that the strict withdrawal limits would not apply to holders of credit or debit cards issued in foreign countries. The announcement came after tourists were seen joining locals in front of ATMs on Sunday.

The Athens stock exchange will also be closed on Monday.

Greek officials said the bank holiday would last for several days and would be accompanied by limits on bank transfers abroad and withdrawals from cash machines.

Greece is due to pay the International Monetary Fund 1.6 billion euros ($1.8 billion) on Tuesday.

Finance Minister Yanis Varoufakis said on Sunday that the chaos was due to mis-management from eurozone officials: "Greece owes money to one part of the troika and we are owed money from another part. They will have themselves to blame if the IMF can't be paid."

Trader reaction

A senior currency strategist at ANZ Bank New Zealand told Bloomberg News: "The knee-jerk reaction is for flight out of the euro and into safety. Defaulting to the IMF tomorrow looks like a certainty and when that happens there is no proposal, there is no legal mandate for Europe to bail out Greece. There are a whole bunch of unknown unknowns."

German banks said on Sunday said they were fortified against possible financial turmoil in Greece.

Germany's biggest lender Deutsche Bank issued a statement on Sunday: "Deutsche Bank has sufficient safety mechanisms in place to safeguard its business activities as well as those of its clients."

A spokesman for Germany's second biggest lender, Commerzbank, commented in a similar vein: "We are very well-prepared because we've been anticipating a situation like this for a long time."

jm/bk (Reuters, AFP)