RTTN: Euro Rises Further Versus Dollar Despite Recovery Concerns
(RTTNews) - The euro jumped to its highest since March versus the dollar on Friday, despite comments from EU officials indicating the economic rebound is "fragile and uncertain."
Even with sovereign debt problems and expectations of slow growth in the euro zone, the euro has surged higher versus the dollar on growing speculation the Federal Reserve is preparing additional measures to support the sluggish US economy.
At the very least, the Fed is all but certain to keep interest rates at a record low near zero for an extended period.
On Friday, traders have sifted through a pile of economic data from around the world, including the latest unemployment figures from the euro zone.
The euro area unemployment rate came in at 10.1% in August, unchanged from July. "Eurozone unemployment appears to have reached a plateau at a high level," said ING Bank economist Martin van Vliet.
Europe's recovery is "fragile and uncertain" and "the risks related to the sovereign-debt market could have a contagious effect on the banking sector," EU finance ministers said in a statement today after a meeting in Brussels.
Still, the euro rose to $1.3764 against the dollar, its highest in 6 months. With the advance, the euro extended its rebound from June's 4-year low of 1.1805.
The euro touched its highest since July versus the yen, rising to Y114.55. A move above 114.73 will take the euro to its highest since May.
In economic news from the US, personal income rose 0.5% in August, the largest increase this year. Spending was steady, according to the Commerce Department
Meanwhile, a report released by Thomson Reuters (TRI) and the University of Michigan on Friday showed a notable upward revision to their reading on US consumer sentiment in September. The index was still down from the previous month.
The report showed that the consumer sentiment index for September was revised up to a reading of 68.2 from the previously reported reading of 66.6.
