Euro Advances Against Franc And Pound
04:43, 20th November 2009
The euro strengthened against the currencies of U.K. and Switzerland in early deals on Friday on the back of higher European stock prices. The euro jumped to an 8-day high against the pound.
On the other hand, the euro was generally weaker against the dollar and the yen during the session.
European shares rebounded today from the previous session's sharp falls and snapped a three-day losing run, aided by gains in commodity stocks on firmer raw material prices.
At 4:01 am ET, the FTSEurofirst 300 .FTEU3 index of top European shares was up 0.4 percent at 1,014.88 points after losing 1.6 percent on Thursday to hit a one-week closing low.
Across Europe, Germany's DAX rose 0.7%, France's CAC 40 index climbed 0.6% and U.K.'s FTSE100 index gained 0.7%.
Germany's Federal Statistical Office announced that the producer price index or PPI dropped 7.6% year-on-year in October, same as in the previous month. Economists expected a decrease of 7.5%. A year ago, the PPI had grown 7.3%.
On a monthly basis, the PPI remained unchanged in October, after falling 0.5% in September. Economists were looking for an increase of 0.1%.
The euro, which closed yesterday's trading at 0.8956 against the pound jumped to an 8-day high of 0.8994 in early deals on Friday. The next upside target level for the euro-pound pair is seen at 0.906.
During early deals on Friday, the euro soared against the Swiss franc. At 4:15 am ET, the euro-franc pair reached 1.5132, up from yesterday's close of 1.5120. If the pair gains further, it may target the 1.515 level.
The euro plunged to 132.24 against the yen and 1.4884 against the dollar in early Asian deals on Friday. Although the euro recovered in the latter part of the session, it dropped again during early European trading. As of now, the euro is worth 1.4893 against the dollar and 132.30 against the yen with 1.4845 and 131.8, respectively seen as next target levels. The euro-dollar pair closed trading at 1.4922 and the euro-yen pair at 132.83 on Thursday.
Japan's Cabinet Office declared that the economy is in deflation, the first official announcement of deflation since mid-2006. The government also said the economy remains in a difficult situation, while maintaining its overall economic assessment.
In its monthly economic report for November, the government said, "Recent price developments show that the Japanese economy is in a mild deflationary phase." The report said the economy is picking up, but faces difficult situation such as a high unemployment rate.
Earlier today, the Bank of Japan board members unanimously decided to leave the uncollateralized overnight call rate unchanged at 0.1% as expected. Upgrading its assessment, the BoJ said Japan's economy is picking up, although the momentum of self-sustaining recovery in domestic private demand remains weak.
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