By: Barbara Zigah
The common currency gained against the U.S. Dollar in Asian trading aided by a rise in commodity prices and a the recent release of a report that the Chinese central bank is considering buying Portuguese bailout bonds. Traders say that the Financial Times article generated sizeable stop-loss purchases of the Euro at the $1.4120 and $1.4150 prices. As reported at 12:39 p.m. (JST) in Tokyo, the Euro was trading 0.5% higher at $1.4162, slightly off the $1.4173 peak struck earlier in the session and the highest price since May 20th.
Earlier, the Euro had gained positive momentum after the Finnish government approved a parliamentary referendum to support a Portuguese bailout; upon winning recent elections, the True Finns party had threatened to withhold that support which was of great concern to the markets. Nonetheless, most analysts concur that ongoing problems in the Eurozone are likely to weigh on the common currency, since there is no clear outcome as to how Greek debt will be handled.
In the commodities market, a rise in crude oil prices to $101.64 per barrel for WTI crude has helped to lift the Euro at the expense of the U.S. Dollar; one analyst points out that per barrel prices higher than $100 is generally U.S. Dollar-negative.