The US dollar was lower on Tuesday ahead of the Federal Reserve’s latest decision on interest rates as new data showed the US trade deficit dropped to its lowest level in 14 months in October, to $58.9 billion. Traders were interested not so much in the Fed’s decision, which was widely expected to keep the interest rate at 5.25 percent, where it has been since June, as they were in the comments that were to come with the announcement of the decision. At mid-afternoon in New York, the US dollar had dropped 0.1 percent versus the euro to $1.3250.
The Japanese yen, meanwhile, dropped 0.1 percent against the euro to ¥155.1 after having dropped to ¥155.00, a new all-time low earlier in the session. The yen was also down 0.1 percent versus the Swiss franc, to ¥97.35, while it fell 0.6 percent to ¥230.25 against sterling. The Japanese currency remained steady at ¥117.00 in relation to the greenback. The yen was hurt by a reduced chance that the Bank of Japan will raise interest rates when it meets on December 19 after new economic data that was weaker than expected.
Sterling was stronger, adding 0.4 percent to £0.6732 versus the euro and gaining 0.5 percent to $1.9670 against the US dollar on higher inflation. The new Consumer Price Inflation numbers will likely add to the speculation that the Bank of England will raise UK interest rates after the first of the year.
The Japanese yen was weaker on Monday after Friday saw a bigger than anticipated downward revision of the growth of the economy in Japan in the third quarter. The revision caused some analysts to reduce the chances that the Bank of Japan will hike interest rates when it meets on December 19, although some still expect the interest rate increase to materialize, especially if the Tankan report on business sentiment is strong.
In mid-afternoon trading in New York, the yen was 0.6 percent lower in relation to the US dollar to ¥117.10, while it dropped 0.7 percent to ¥154.66 against the euro.
The US dollar, meanwhile, dropped 0.1 percent to $1.3210 versus the euro to keep almost of all the gains it achieved on Friday. However, pressure was up on the dollar by the news that oil producing nations have reduced their exposure to the greenback. New data released by the Bank for International Settlements has Russian and the OPEC nations reducing their dollar reserves from 67 percent in the first quarter of the year to 65 percent in the second quarter. At least one analyst has said that there is no reason to think that the dollar selling was limited to the first half of the year.
Sterling moved little while investors waited to see what new CPI data in the UK, due on Tuesday, might have to say about where interest rates there might go in the future. The UK currency was steady at $1.9530 in relation to the US dollar, while it dropped 0.1 percent to £0.6765 against the euro.
The Japanese yen saw gains on Tuesday after comments from a board member of the Bank of Japan that indicated that interest rates in Japan could rise again soon. Atsushi Mizuno said it was incorrect to expect rates to remain where they are until all economic indicators were strong. This led some analysts to believe that the Bank would raise interest rates to 0.5 percent when it meets later this month. Some analysts, however, think that the rate rise won’t come until January if it comes at all, and then will remain at that level for at least half a year.
In mid-afternoon trade in New York the yen had gone up 0.3 percent versus the US dollar and the euro, to ¥115.05 and ¥153.20 respectively. The Japanese currency was 0.7 percent higher in relation to sterling as well as to both the Australian and New Zealand dollars, to ¥226.95, ¥90.37, and ¥78.95.
The Swiss franc was also higher, adding 0.3 percent against the US dollar to SFr1.1915 and also gaining 0.3 percent to SFr1.5868 versus the euro.
The US dollar managed an 0.1 percent gain against the euro, to $1.3305 on new data from the Institute of Supply Management that showed the service sector in the US up from 57.1 in October to 58.9 in November, in contrast to expectations of a decline to 55.5.
Sterling was weaker on the day, dropping 0.3 percent to $1.9730 versus the greenback and falling by the same percentage against the euro, to £0.6750. The UK currency was hurt by low retail sales in November.
The US dollar weakened significantly this week after new data showed that manufacturing contracted in November, raising the chances that the US Federal Reserve will cut interest rates. The recent declines began when several central banks, including in China, began talking about diversifying their currency reserves away from the dollar. Investors began to back away from risky investments such as carry trades, which had been supporting the greenback.
During the week the dollar dropped 0.6 percent against the Japanese yen to ¥115.23, while it fell 1.8 percent versus the euro to $1.3323 and was 2.2 percent lower against sterling. Even absent any real data other than an increase in house prices in the UK, sterling also added 0.7 percent in relation to the euro, to £0.6725.
A batch of positive economic data in the Eurozone raised the chances that the European Central Bank will raise interest rates to 3.5 percent when they meet next Thursday. New figures released Thursday had Eurozone inflation at 1.8 percent, only 0.2 percent below the top of the ECB’s target range. Besides its gains versus the US dollar, the euro was also 1.2 percent higher versus the yen during the week, to ¥153.52. The yen was hurt by a downward revision of economic growth in fiscal 2005-2006 from 3.3 percent to 2.4 percent.
The US dollar weakened against major currencies on Thursday as the Chicago Purchasing Manager’s Index fell below the threshold for expansion despite the expectation of some analysts that it would rise in November. The Chicago index was at 49.9 in November, after being at 53.5 in October. It remains to be seen whether the PMI contraction was regional or will prove to be a national phenomenon when the Institute of Supply Management’s index is released Friday.
At midday in New York, the euro had added 0.7 percent to $1.3250 versus the greenback, helped by Eurozone gross domestic product figures that were up 0.5 percent in the third quarter as business activity was better and household spending was strong. The Japanese yen also was 0.7 percent higher in relation to the US currency, to ¥115.60, while sterling gained 1.2 percent against the US dollar to $1.9696. The UK currency was also higher versus the euro, adding 0.3 percent to £0.6737.
The Canadian dollar was lower in relation to the greenback on slower than expected growth in the third quarter and on the likelihood that the Bank of Canada is about to reduce interest rates. The Canadian currency dropped 0.4 percent to C$1.1422 versus the US dollar. The Australian dollar, however, added 0.8 percent against the greenback to $0.7896 on higher retail sales and the expectation that interest rates there will go up again next year. The Aussie was also higher in relation to the yen, gaining 0.2 percent to ¥91.31.
The euro strengthened again on Tuesday, helped by new data that showed the money supply in the Eurozone growing at an annual rate of 8.5 percent in October, above the 4.5 percent reference rate set by the European Central Bank. Meanwhile, two more French officials added their voices to recent French declarations that the euro was getting too strong and that Eurozone nations should have more say in ECB policy moves. Other Eurozone officials have not stepped up to support the French comments, and in fact the Austrian finance minister remarked that the euro’s strength is not special and simply is an indication of the Eurozone’s strong economy.
By mid-afternoon in New York, the shared currency was 0.2 percent higher against the Japanese yen, to ¥152.80, after hitting another all-time high of ¥153.06 earlier in the session. The euro reached its highest level in nearly two years versus the US dollar, at $1.3181, before dropping back a bit. Still, the dollar was 0.2 percent lower versus the euro to $1.3150, recovering a bit on existing home sales in the US in October that were better than had been expected. The greenback added 0.1 percent to ¥116.20.
Sterling was also stronger on the session, adding 0.4 percent to £0.6752 versus the euro and gaining 0.5 percent to $1.9480 against the US dollar, a two year high. The UK currency was helped by growth in house prices that were up at their best pace in almost a year and a half in October, and by a bid by Spanish utility Iberdrola for Scottish Power. Additionally, Gordon Brown said that the UK’s economy would grow more than had been expected this year.
The US dollar was weaker ahead of the Thanksgiving Day holiday amid slow trade and reports that the Council of Economic Advisors, made up of President George W. Bush’s economic advisors, have lowered their forecasts for growth of the US economy. The Council said that it made its growth revisions based on weakness in the US housing market. A larger than expected rise in unemployment claims also hurt the US currency.
The greenback fell 0.7 percent to $1.2940 versus the euro and dropped 0.8 percent to $1.9140 in relation to sterling. The euro was helped by comments from the prime minister of Luxembourg, speaking before the European Parliament, that criticized recent remarks by both the president and prime minister of France that called for more input into currency issues by members nations of the Eurozone. The Luxembourg PM said that the European Central Bank should be politically independent.
The Japanese yen and the Swiss franc gained even more versus the dollar during the day Wednesday. By mid-afternoon in New York the Swiss franc had added 1 percent versus the greenback to SFr1.2275, while the yen gained 1.1 percent to ¥116.60, its highest level against the US currency in two months. The yen was also higher against the euro, adding 0.4 percent to ¥150.80.
The US dollar was weaker on Friday but higher over the week on rumors that a large hedge fund had to sell its dollar positions in order to pay for losses in the oil market after crude oil prices fell to their lowest levels in a year. The greenback, which was benefiting from the drop in oil prices before this development, dropped 0.2 percent to $1.2830 versus the euro, while it fell 0.3 percent to $1.8940 in relation to sterling and was 0.4 percent lower to ¥117.70 against the yen. Still, over the week the dollar added 0.2 percent each against the euro and yen and was up 0.9 percent versus sterling.
Other major currencies helped the dollar over the week as they were beset by negative news. The yen was hurt by a decision from the Bank of Japan to leave interest rates at 0.25 percent for another month, while the euro was not helped by comments from both the prime minister and president of France that the strong euro was hurting exports and that the member nations of the eurozone should have more input into European Central Bank monetary policy decisions. Meanwhile, sterling dropped 0.7 percent in relation to the euro during the week on a quarterly inflation report from the Bank of England that seemed to ruin hopes of another interest rate hike in the UK.
The Swiss franc was 0.3 percent lower versus the US dollar and fell 0.4 percent in relation to the euro after the chairman of the Swiss National Bank said that the safe-haven status of the Swiss currency had been diminished as a result of the introduction of the euro and the consequent disappearance of the weaker of the European national currencies.
Currencies with strong links to commodities were lower over the week as oil and metals prices declined. The Canadian dollar and the South African rand each dropped 1.1 percent versus the US dollar, while the Norwegian krone fell 1.2 percent against the greenback.
November 16, 2006
US core CPI up only 0.1 percent in October; dollar strengthens
Core consumer inflation was down in October, rising just 0.1 percent for a drop in the annual rate to 2.7 percent, down from 2.9 percent in September. Analysts said that while inflation is still higher than it should be, but that recent statements of concern by Federal Reserve officials seemed to be exaggerated considering that core inflation was now on the way down.
After the release of the new CPI data, the US dollar dropped briefly versus major currencies, but by mid-afternoon in New York, the greenback had added 0.1 percent against both the euro and the yen, to $1.2810 versus the euro and ¥118.10 against the yen. The dollar did not fare so well against some other currencies, however, as the South African rand added 0.6 percent to the dollar to R7.1600, while the Turkish lira gained 0.8 percent versus the greenback, to TL1.4335.
Meanwhile, the euro was not affected by yet another statement out of France, this time from French President Jacques Chirac, that members of the eurozone should have more input into monetary policy as set by the European Central Bank. The non-reaction to Mr. Chirac’s statement, added to the decision by the Bank of Japan to keep interest rates at their present level there, combined to send the yen 0.1 percent lower in relation to the euro, to ¥151.30.
Sterling was slightly higher versus both the US dollar and the euro on new data showing retail sales in the UK up by 0.9 percent in October, well ahead of the forecast of a gain of 0.3 percent. The UK currency added 0.1 percent versus the greenback, to $1.8900 versus the greenback, while it also added 0.1 percent against the euro, to £0.6775.
French prime minister Dominique de Villepin made remarks Tuesday that sent the euro down for a time before recovering later in the session. Mr de Villepin said that he believes that the European Central Bank cannot be allowed to be the sole determiner of exchange rates for the euro. The remarks, which came during a meeting with subcontractors for Airbus, were widely interpreted as meaning that the prime minister thinks the euro should be weaker. Analysts were surprised that the remarks had as much of an effect on currency markets as it did, since Mr de Villepin doesn’t have power to affect the exchange rate.
Apparently most investors came to the same conclusion, since the euro recovered quickly from the losses, ending up about the same versus the US dollar at $1.2809 and adding 0.4 percent in relation to sterling to £0.6760. The shared currency was helped by the ZEW index of investor sentiment, which came in at 53.0 for November, much higher than October’s 42.9. The dollar was not helped by lower US producer prices and retail sales, while sterling did not benefit from a UK producer price index that was at 2.4 percent in October when a rise to 2.6 percent had been anticipated.
The yen, meanwhile, was stronger versus both the US dollar and the euro, adding 0.3 percent to ¥150.68 in relation to the euro and gaining 0.4 percent against the greenback to ¥117.70. The Japanese currency benefited from data showing that the Japanese economy expanded more quickly in the third quarter than had been expected, raising the possibility that the Bank of Japan might send interest rates higher before the end of the year.
The Japanese yen weakened on Monday on fears that an expected interest rate hike could reverse that nation’s economic recovery. Analysts expect the rate to go up before the new fiscal year begins in April 2007, but both the policy chief of the ruling Liberal Democratic party and a former financial services minister have said that raising rates too quickly could harm Japan’s economy.
By mid-afternoon in New York, the yen had lost 0.2 percent in relation to the euro to ¥151.34 and it was 0.5 percent lower versus the US dollar, to ¥118.15.
Sterling was lower as well, on weaker economic data than had been anticipated. Initially higher against the dollar, the UK currency dropped 0.5 percent to the greenback to $1.9015, while the UK currency was down 0.2 percent to £0.6732 against the euro.
The US dollar was 0.2 percent higher in relation to the euro to $1.2834 even though talk continued over last week’s comments from China that it is planning to diversify its foreign exchange reserves. Monday the talk continued as China’s State Information Centre, a think tank supported by the Chinese government, recommended that China should extend diversification by building its strategic reserves of bulk commodities, metals, and oil.
The Swiss franc added 0.2 percent versus the euro to SFr1.5935 on comments from the chairman of the Swiss National Bank that interest rate increases could help strengthen the currency there.
Lower metals prices hurt the Australian dollar, the Canadian dollar, and the South African rand as all fell in relation to the US dollar. The Canadian dollar dropped 0.5 percent to C$1.1374 against the greenback, while the Aussie fell 0.6 percent to $0.7625 to the US dollar, and the rand was 0.8 percent lower to R7.2535 to the dollar.
The US dollar lost value over the week as the governor of the People’s Bank of China said that his nation is looking to diversify its foreign exchange reserves. This, coupled with an announcement on state television in China that forex reserves there were above $1,000 billion for the first time in history and comments from the director of China’s National Economic Research Institute that the imbalance between US and Chinese currency is the fault of the US Treasury for printing too much money, all spurred sell-offs of the greenback. Not all analysts, however, saw the remarks as the real problem and said that they were just being used as an excuse to sell.
The dollar lost 0.4 percent during the week to the Japanese yen, to ¥117.50, while it dropped 0.7 percent to $1.9140 in relation to sterling and fell 1.1 percent to $1.2860 versus the euro.
The euro also strengthened in relation to sterling and the yen. The shared currency was 0.6 percent higher to £0.6720 against sterling, while it added 0.7 percent against the yen, to ¥151.05. Some of the euro’s strength came after comments from European Central Bank officials that indicated there are more interest rate hikes to come.
As expected, the Bank of England’s Monetary Policy Committee raised interest rates by 25 basis points to 5 percent on Thursday, but the statement that accompanied announcement of the rate hike provided little guidance as to where rates will go in the future. The lack of information spurred a sell-off that sent sterling lower versus the euro. The UK currency dropped 0.6 percent in relation to the shared currency to £0.6732.
The euro was also helped by remarks from a member of the executive board of the European Central Bank that implied that further interest rate hikes in the Eurozone are coming up. Lorenzo Bini Smaghi said in Milan the current price of borrowing money is “too accommodating”. The euro added 0.7 percent to ¥151.40, yet another new record high.
The US dollar continued to weaken as it was reported that the nation’s trade deficit narrowed less than had been expected, to $64.3 billion. Also damaging the dollar was a statement from the governor of the People’s Bank of China that it was planning to diversify its foreign exchange reserves, which now are around 70 percent in US currency. The greenback was 0.1 percent lower against both the yen and sterling, to ¥117.80 and $1.9070 respectively, while it dropped 0.7 percent versus the euro to $1.2840.
Weak employment data in Australia sent the Australian dollar 0.4 percent lower against the dollar, to $0.7670 as the figures were said to be another sign that interest rates there have hit their ceiling for now.
The US dollar remained close to Tuesday’s levels on Wednesday in the wake of election results that put the Democratic Party in the majority in the United States House of Representatives. Control of the Senate still had not been decided on Wednesday morning due to at least one race, in Virginia, that was too close to call.
Analysts were divided on what the outcome of the election meant. Some said that the change in the balance of power would mean very little to the markets absent any other factors. Others felt that the election results were strongly dollar-negative due to the potential for stalemate in the Iraq situation between the Republican White House and the Democratic House as the Bush administration continues to press its objectives in the face of serious questioning from the House.
At mid-afternoon in New York, the greenback was even against the euro at $1.2770, while it had gained a bare 0.1 percent to ¥117.8 versus the Japanese yen.
Sterling was even in relation to the US currency at $1.9050 and dropped 0.1 percent to the euro, to £0.67.04 as investors waited for the Bank of England to make its next interest rate decision on Thursday. Most analysts believe that a rate hike from the Monetary Policy Committee is a done deal, especially after new data that shows shop prices in October going up at their fastest rate since May 2004.
In other interest rate news, the Australian dollar dropped 0.6 percent versus the greenback to $0.7680 after the Reserve Bank of Australia raised interest rates there by 25 basis points to 6.25 percent, as it had been expected to do.
The Chinese renminbi added 0.1 percent to Rmb7.8719 to the dollar, a new high since its revaluation last year.
The US dollar was much weaker on Tuesday on comments from the president of the San Francisco Federal Reserve and the governor of the Bank of Japan that resulted in sell-offs. Just after midday in New York, the greenback was down 0.7 percent versus the euro to $1.2800, 0.8 percent lower against the Japanese yen to ¥117.45, and it had fallen 0.9 percent in relation to the Swiss franc, to SFr1.2465.
Janet Yellen, president of the Fed in San Francisco, said that some nations with extra savings could decide to invest less money in the United States, but analysts pointed out that such warnings of diversification by central banks had been sounded in the past and that former Fed chairman Alan Greenspan has spoken to the issue more than once in the recent past. Meanwhile, in Tokyo, Toshihiko Fukui said that the Bank of Japan should not wait for inflation to go up before raising interest rates and should instead raise rates moderately ahead of inflation. Analysts also discounted these remarks, putting them down to an attempt to moderate expectations on rates.
Sterling strengthened on the session, adding 0.1 percent against the euro and gaining 0.6 percent on the US dollar to $0.6700. The advances came after the National Institute of Economic and Social Research estimated that in the three months up to October, the UK economy grew at a quarterly rate of 0.7 percent and said that the Bank of England needs to raise interest rates when it meets on Thursday. It also said that it sees the likely need for another rate hike in February.
The Australian dollar also added 0.6 percent versus the greenback, to $0.7760 in anticipation of a new decision on interest rates from the Reserve Bank of Australia, due Wednesday.
The US dollar was stronger on Monday ahead of Tuesday’s mid-term elections as it appeared that the Democratic party could take the majority from the Republicans in the House of Representatives or the Senate. Some analysts believe that the political stand-off that could follow such a development might benefit the dollar because President George Bush would be limited in his ability to make moves that could increase world tensions. In addition, the dollar was helped by last week’s positive unemployment figures, which are seen as decreasing the likelihood that the Federal Reserve will cut interest rates next year.
In mid-afternoon activity in New York, the greenback had added 0.1 percent versus the euro to $1.2700, while it gained 0.3 percent in relation to the Japanese yen to ¥118.40.
The Swiss franc was 0.2 percent lower versus the US dollar to SFr1.2565, while it dropped 0.1 percent to SFr1.5960 against the euro. The yen was also lower in relation to the euro, dropping 0.2 percent to ¥150.40.
Sterling was weaker on the announcement that manufacturing output was just steady in September, when a bit of a rise had been expected. The UK currency fell 0.2 percent in relation to the greenback to $1.8960, while it was 0.7 percent lower to £0.6700 versus the euro. The new data was not expected to stop the Bank of England from raising interest rates when it meets later in the week.
The Czech koruna was 0.4 percent higher versus the euro, to a record high of Kc27.920. Meanwhile, the Mexican peso was 0.3 percent lower to 10.824 pesos to the dollar after three bombings in separate locations in Mexico City.
The euro benefited from Thursday’s decision by the European Central Bank’s comments that strongly signal that Eurozone interest rates will rise in December. The comments came as the Bank announced that it will leave rates at 3.25 percent this month. The ECB’s president said in the remarks that “strong vigilance” against interest rates is needed. Many analysts are convinced that not only will rates rise in December, but that they will rise again after the first of the year. Strong new manufacturing data out of the Eurozone is one bit of evidence for the expected rate hikes.
By mid-afternoon in New York, the euro had added 0.2 percent against the US dollar, sterling and the Japanese yen, sitting at $1.2770 versus the greenback, at £0.6695 against sterling, and at ¥149.50 in relation to the yen. Before the decision, the euro had declined against the yen, falling as low as ¥148.86.
The US dollar dropped 0.1 percent to ¥116.90 after both the Bank of Japan and Japan’s Finance Minster made remarks that indicated a planned hike in interest rates there if the economy there continues to grow as expected.
The Australian dollar dropped 0.2 percent versus the US dollar to $0.7735 on retail sales that were slower than expected in September. Despite the new data, analysts still expect the Reserve Bank of Australia to hike interest rates by 25 basis points to 6.25 percent when it meets next week.
The US dollar was weaker on Wednesday on new data from the Institute of Supply Management that shows the manufacturing sector at its lowest level since June 2003, well below the forecast numbers. Analysts said that this new survey, coupled with other recent disappointing economic news, supports the view that the next time the Federal Reserve alters interest rates, that alteration will be in a downward direction. This view is in direct opposition to recent comments made by Richmond Fed president Jeffrey Lacker that interest rates need to be raised further.
The greenback was 0.2 percent lower versus both the euro and the yen, to $1.2780 and ¥116.80 respectively, and down 0.3 percent against the Swiss franc to SFr1.2415 by mid-afternoon in New York.
Sterling continued to strengthen, adding 0.1 percent to £0.6680 in relation to the euro and gaining 0.2 percent to $1.9110 against the US currency. The gains came even though the UK manufacturing purchasing managers’ index was down to 53.7 in October, from 54.5 in September. Output prices, however, were up, increasing the likelihood that the Bank of England will hike interest rates when its Monetary Policy Committee meets next week.
The only major currency to fall in relation to the US dollar was the Canadian dollar, on the news of a proposal by Canada’s finance minister to end the favorable tax treatment now received by income trusts in that country. The Canadian dollar dropped 0.8 percent to C$1.1310 versus the greenback.
In Norway, the krone added 1 percent to NKr6,4690 to the US dollar and was 1.1 percent higher to NKr8.2650 versus the euro after the Norges Bank hiked the interest rate there by 25 basis points to 3.25 percent and said that further hikes could come sooner than had been expected.
Sterling strengthened on Monday after new data showed that house prices in the UK rose at their fastest rate in two years in October and mortgage approvals were at their highest in two and a half years in September. Both reports appeared to indicate that the Bank of England will raise interest rates again when its monetary policy committee meets next week.
By the middle of the afternoon in New York, the UK currency was 0.2 percent higher against the US dollar to $1.9020, while it had added 0.5 percent to £0.6680 versus the euro, its highest level in a year and a quarter.
The US dollar, meanwhile, didn’t seem to know where to go as it gained 0.2 percent to $1.2715 versus the euro but dropped 0.1 percent to ¥117.40 in relation to the Japanese yen. This followed a decline by the greenback on Friday on the news that the US economy had not grown as much as had been hoped.
The yen added 0.3 percent to ¥149.30 against the euro as most analysts expected the Bank of Japan to hold interest rates at the current level of 0.25 percent when it meets on Tuesday. The yen was also helped by the news that the Swiss National Bank has added more yen to its foreign exchange reserves.
In Brazil, the reelection of Luiz Inacio Lula da Silva as president sent the real 0.3 percent lower to R$2.1340 to the US dollar.
The US dollar weakened on Thursday, following the decision by the Federal Reserve on Wednesday to keep interest rates at 5.25 percent for another month. Perhaps even more influential than the decision not to alter the rate were the comments that accompanied the announcement, which was not sufficiently concerned about the possibility of inflation for some analysts and investors. Some analysts expect that the Fed will actually cut rates after the first of the year.
In mid-afternoon trade in New York, the dollar had dropped 0.3 percent against the Japanese yen to ¥118.70 and was 0.5 percent lower versus both the euro and sterling, to $1.2665 and $1.8870 respectively.
The euro was slightly stronger against both sterling and the yen after the president of the European Central Bank said that inflation will remain a risk in 2007 and that the Bank should “remain vigilant” in the face of inflation pressures. Such wording is sometimes seen as a sign that interest rates are likely to rise soon. The euro also got a boost from former US Federal Reserve chairman Alan Greenspan, who said in comments to a group in Washington that both the private sector and central banks are starting to buy euro in preference to the dollar.
The euro added 0.1 percent to £0.6715 in relation to sterling, while it was 0.2 percent higher to ¥150.26 versus the yen.
The Australian dollar was 0.2 percent higher versus the US dollar to $0.7620, but the Canadian dollar was 0.4 percent lower versus the greenback to $1.1280 and the New Zealand dollar fell 1.1 percent to $ 0.6545 against the US currency on the news that the Reserve Bank of New Zealand had kept interest rates at 7.25 percent.