Auction Demand Helps Boost Euro to 3-week Peak

Barbara Zigah

 By: Barbara Zigah

Solid demand at Spain’s bond auction yesterday helped to boost the common currency Euro up to a 3-week peak versus the U.S. Dollar; the Euro is now headed for its second consecutive week of gains. As reported at 2:38 p.m. (JST) in Tokyo, at one point in the day’s trading session, the Euro rose against the greenback to $1.2414, a 3-week high, managing to hold on to the .6% gain from yesterday. This week alone, the Euro has risen better than 2% despite the Greek downgrade of sovereign debt to junk status by Moody’s rating agency. 

The auction’s success also helped calm investor worries over peripheral Euro-zone debt and whetted risk appetite for high yielding currencies such as the New Zealand and Australian Dollars, both of which held close to 1-month peaks against the safe-haven U.S. Dollar. The New Zealand Dollar traded against the greenback at $0.7068, just off a 1-month high, while the Australian Dollar gained .2% to trade at $0.8693, retreating slightly from $0.8714, a 1-month high. 

The U.S. Dollar’s softness is being attributed to an increase in jobless claims report, and poorer manufacturing data than had originally been forecast; those reports which were released yesterday in the U.S., prompted forex investors to reconsider their expectation that the Federal Reserve might soon increase interest rates.   The U.S. Dollar Index, a measure of the U.S. unit’s strength against other major currencies, slipped .1% to 85.57 DXY.

Barbara Zigah

After working on Wall Street, Barb began her second career as a freelance writer at Daily Forex, where the CEO recognized fresh, untapped potential and was willing to give her a try. She’s never looked back. Since then, she’s worked steadily as a freelance writer and editor in the financial services and Forex-related industry.

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