Euro drives toward 11-month high against greenback

Posted On: January 28, 2013

The shared currency of the European Union approached its 11-month high against the world's reserve currency on Tuesday amid increased optimism in the 17-nation bloc, according to Reuters.

The euro's gains are largely linked with the growing belief that the sovereign debt crisis' most damaging tendencies are over after the scourge attacked regional banks, public finance systems and markets.

"The trend in euro/dollar is still very much upwards, and I think the market is desperate for a pullback to get a bit more animated about a test of the topside," FX strategist Daragh Maher with HSBC told Reuters on Tuesday. "There has been a substantial reduction in the tail risks (regarding the euro zone) and the euro has got momentum."

Analysts said indications of portfolio inflows returning to the euro zone were providing a boost for the euro. But purchasing managers' index data from the euro zone is scheduled to be released later this week.

Bloomberg reports Belgian Finance Minister Steven Vanackere said that the sovereign debt crisis is pulling back after wreaking havoc during the past three years, noting political plans for increased financial integration have proved vital.
 

Category: Industry News

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