Euro Soars To Fresh Multi-month High Against Dollar
The euro advanced against other major currencies during Friday’s early European deals as investors bought the single currency after the European stocks opened the day in green. The euro rose to a near 3-week high against the franc, 4-day high against the pound and a new 2-month high against the dollar.
Meanwhile, the euro recouped its Asian session’s losses against the yen.
The European stocks opened higher today despite a slide in most Asian stocks. However, some European stocks recently have pared some of their initial advance.
Around 5:25 am ET, U.K’s benchmark FTSE 100 index was up 22.24 points or 0.4% at 5,233.82, France’s CAC 40 index gained 4.95 points or 0.2% at 3,586.75 and Germany’s DAX rose 6.18 points or 0.1%.
Following recent weak manufacturing and wholesale prices data from the U.S. yesterday, most Asian stocks fell today on concerns about the global economic recovery.
The euro resumed its gains despite a dismal Euro-zone trade balance report published at 5:00 am ET.
The eurozone’s trade balance with the rest of the world slipped into deficit in May from a small surplus in April, official figures showed. The unadjusted deficit was EUR 3.4 billion, compared with a surplus of EUR 0.3 billion in April. Economists had predicted a much smaller deficit of EUR 0.5 billion. In May last year, a surplus of EUR 2.2 billion was registered.
The euro advanced to a new 2-month high of 1.2984 against the U.S. dollar at 5:30 am ET. As of now, the euro-dollar pair is trading at 1.2978 with 1.310 seen as the next upside target level. At yesterday’s close, the pair was worth 1.2944.
Against the pound, the euro is now trading at a 4-day high of 0.8420, up 0.53% from yesterday’s closing quote of 0.8375. If the euro gains further, it may target around the 0.875 level.
The euro is now worth 112.99 against the yen, compared a low of 112.30 hit at 11:45 pm ET Thursday. On the upside, the euro may target around the 113.40 level. The euro was worth 113.15 against the yen at yesterday’s close.
The Bank of Japan said today that the nation’s economy is likely to recover at a moderate pace, driven by improvements in global economic conditions.
In its latest monthly report reviewing the economy, the Bank of Japan said exports and industrial production have been picking up, although it expects the pace of increase to moderate gradually.
The euro-franc pair has appreciated 0.24% over yesterday’s close of 1.3481 and is now trading near a 3-week high of 1.3520. The euro may target around the 1.404 level, if it gains further.
Across the Atlantic, the U.S. CPI for June, Treasury Department’s report on the flows of financial instruments into and out of the U.S. for April and the preliminary report of the Reuters/University of Michigan’s consumer sentiment survey for July are slated for released during New York morning session.
