Greece continues to be in the news as the current opinion polls suggest that pre-bailout parties will lose again in the June election, which may ultimately lead to “Grexit” from the monetary union. If Greece leaves the Euro-zone, it would be very difficult for the other bigger troubled countries like Spain and Italy to refinance their debt as the investors would expect them to go next.

Further, the crisis in Europe is now not limited to the peripheral countries but there are increasing signs that German economy may also be faltering. Yesterday, the widely watched German business confidence index had a surprisingly sharp fall after rising for the past six months. At the same time, the European political leadership remains divided on the measures needed to tackle the crisis. (Read: Norway ETFs for Safer European Play)

Due to increasing risk and uncertainty in the Euro-zone, investors are puttingtheir money in assets perceived as “safe haven”, including the US Dollar and Japanese Yen.

The dollar has gained against all major currencies, specially the Euro, the British Pound and the Swiss Franc in the past few weeks as the crisis escalated. The ICE Dollar Index, which tracks the U.S. Dollar against a basket of currencies, has gone up from 78.9 to 82.5 in the last three months. (Read: Euro Small Cap ETFs: The Way to Play Europe?)

After weakening earlier this year due to weaker trade data, the Japanese Yen has grown stronger in recent weeks as concerns about the euro zone grew. However, Japanese currency’s rise is likely to be somewhat limited by recent downgrade of the country’s sovereign debt by Fitch and Bank of Japan’s interventions in the currency market. (Read: Poland ETFs Head-To-Head)

In normal times, Swiss Franc and to a certain extent UK Pound are also regarded as safe haven currencies but as these currencies are impacted by the events in Euro-zone, they have depreciated against US Dollar. (Read: Poland ETFs Head-To-Head)

The investors can consider buying US Dollar and Japanese Yen ETFs to profit from the ongoing uncertainly. However we would like to add that currency funds are in general suitable only for short-term trading or hedging and should not be considered for longer-term investment.

PowerShares DB US Dollar Index Bullish Fund ( UUP - ETF report )

UUP seeks to track the price and yield performance of the Deutsche Bank Long US Dollar Futures index. The index is comprised of long futures contracts designed to replicate the performance of being long the US Dollar against the Euro, Japanese Yen, British Pound, Canadian Dollar, Swedish Krona and Swiss Franc.

The ETF has returned 1.42% year-to-date and it charges 75 bps to the investors per year for operating expenses. Daily volume exceeds 800 thousand shares currently. Introduced in February 2007, the fund has attracted $1.17 billion in assets so far.

CurrencyShares Japanese Yen Trust ( FXY - ETF report )

FXY seeks to track the price of the Japanese Yen, by maintaining a deposit account denominated in the currency. The interest on the deposit account is used to pay for the trust’s expenses. The ETF is down 3.08% year-to-date but has appreciated 2.7% in the past month due to renewed interest in the currency. The fund made its debut in February 2007 and has attracted $198.5 million in assets till date. The ETF has an expense ratio of 40 basis points per year.