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Euro edges higher against US dollar

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NEW YORK, Feb 11 AFP

February 12 2013, 12:10AM

The euro has edged up against the US dollar as the United States urged the Group of 20 economic powers to avoid competitive currency devaluation that would threaten economic growth.

At 0900 AEDT on Tuesday, the euro was priced at $US1.3404 compared with $US1.3361 on Friday.

Both currencies rose on Monday against the Japanese yen, which has been under pressure following Tokyo's recent efforts to fight deflation.

The euro was at Y126.42 compared with Y123.83 on Friday, while the greenback jumped to Y94.33 from Y92.70 on Friday.

The euro's rise reversed last week's decline prompted by comments made by European Central Bank president Mario Draghi, who gave a middling picture of the eurozone economy.

The rebound was helped along by comments from Bundesbank chief Jens Weidmann, who said the euro was not overvalued.

Meanwhile, currency markets are beginning to look ahead to Friday's meeting of the Group of 20 economic powers in Moscow.

Lael Brainard, the Treasury official who will lead the US delegation to the meeting, urged members to "move to market-determined exchange rates and refrain from competitive devaluation".

Japan's recent monetary easing has stoked fears, especially in Europe, of a currency war between the major economies as policymakers seek to devalue their currencies to make exports more competitive.

Brainard reiterated a US call for China to do more to let the yuan float more freely in the market.

At the same time, Brainard praised Japan's efforts to boost growth and counter deflation - suggesting Washington would not support any criticism of Tokyo at the G20 meeting, said Kathy Lien, an analyst at BK Asset Management.

The British pound gave ground to the US dollar, trading at $US1.5657 compared with $US1.5796 on Friday. The US dollar gained on the Swiss franc, trading at 0.9201 compared with 0.9168 on Friday.