Euro surges as eurozone outlook brightens
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NEW YORK, Feb 1 AFP
February 02 2013, 10:46AM
The euro continued to zoom higher against the dollar on Friday, lifted by renewed optimism about the eurozone and a key US jobs report.
The euro bought $US1.3637 around 1100 AEDT on Saturday, surging from $1.3579 at the same time late on Thursday. Earlier the European currency hit $1.3711, its highest level since November 2011.
"The rally was kicked off by better than expected eurozone data and more specifically upward revisions to German and eurozone manufacturing PMI," said Kathy Lien of BK Asset Management.
Lien said the euro also benefited from the rise in US stocks, which rallied sharply on news that the US unemployment rate rose to 7.9 per cent in January from 7.8 per cent in December.
The reading reinforced expectations that the Federal Reserve will maintain its ultra-loose monetary policy for the foreseeable future, a stance that supports equities.
Investors pushed the Dow Jones Industrial Average to a close above 14,000 for the first time since October 2007.
The euro, which has been gaining ground against the dollar this week amid signs of a more upbeat outlook for the embattled eurozone, benefited from a stronger-than-expected reading on eurozone manufacturing activity.
"That gave the impression to investors that the eurozone was heading toward a better economic performance," said Charles St-Arnaud of Nomura.
The euro advanced to 126.60 yen from 124.53 yen late on Thursday, while the dollar also rose against the Japanese currency, to 92.80 yen from 91.71 yen.
The dollar fell against the Swiss currency, to 0.9074 francs from 0.9100 francs.
But the greenback strengthened against the pound, which fell to $1.5691 from $1.5857.