The euro touched its highest level this week against the dollar and climbed versus the Swiss franc as stocks and commodities rose on speculation the global economic recovery will be sustained. Sterling fell against all of its most-traded counterparts as minutes of the Bank of England’s May 5 meeting showed most policy makers said higher interest rates might hurt the recovery. Sweden’s krona advanced as the National Debt Office reported that the nation will have a larger budget surplus than previously forecast. Europe’s common currency had its first back-to-back gains against the franc this month on reduced demand for a refuge. “There’s clearly some degree of relief, and that’s being shown in the euro,” said Jane Foley, a senior currency strategist at Rabobank International in London. “There are certainly signs of stability, though there are still jittery undertones, which are going to make the market vulnerable.” The euro traded at $1.4225 at 8:12 a.m. in New York, compared with $1.4237 yesterday, after touching $1.4287, the highest level since May 13. The euro appreciated 0.1 percent to 1.2542 Swiss francs, from 1.2531. The dollar slid 0.3 percent to 81.16 yen, from 81.42. The euro dropped 0.4 percent to 115.50 yen, from 115.91. IntercontinentalExchange Inc.’s Dollar Index, which measures the greenback against the currencies of six major U.S. trading partners, was little changed at 75.426 as the Federal Reserve prepared to release minutes of its April 26-27 meeting. ‘Printing Dollars’ “We don’t hear any talk about rate increases in the U.S., while such expectations are supporting the euro,” said Tsutomu Soma, a bond and currency dealer at Okasan Securities Co. in Tokyo. “The Fed is printing dollars aggressively, but we have yet to see inflation concerns rise. That means the U.S. is far away from exiting stimulus measures.” Fed Chairman Ben S. Bernanke said last month that he was unsure when monetary stimulus would unwind. Policy makers kept the target rate for overnight lending between banks at zero to 0.25 percent. The rate has remained at that level since December 2008. The euro region’s main refinancing rate is 1.25 percent. The dollar has lost 3.9 percent this year, according to Bloomberg Correlation-Weighted Currency Indexes, a gauge of 10 developed-nation currencies. The euro has risen 2.7 percent. Europe’s recovery is becoming more solid and is undeterred by tension in sovereign-debt markets, European Union Economic and Monetary Commissioner Olli Rehn said. The base of the expansion is “broadening from exports to domestic demand, and thus the recovery is becoming more solid and self-sustaining,” he said at a conference in Brussels today. Greece’s Debt Turmoil European Central Bank officials ruled out a Greek debt restructuring, clashing with political leaders over a solution to the sovereign-debt crisis. “A Greek debt restructuring is not the appropriate way forward -- it would create a catastrophe,” the ECB Executive Board member Juergen Stark said today in Lagonissi, Greece. A fellow board member, Lorenzo Bini Smaghi, said in Milan there is no difference between a “hard” or “soft” restructuring. Sterling declined 0.5 percent to 88.07 pence versus the euro and slid 0.7 to $1.6147 as minutes of the Bank of England’s meeting published today indicate that Governor Mervyn King and the other five members of the Monetary Policy Committee voted for no change in the record low 0.5 percent target lending rate. Andrew Sentance maintained his call for a half-point increase, Chief Economist Spencer Dale and Martin Weale continued a push for a quarter-point advance, and Adam Posen kept up a call for more bond purchases. Stronger Krona The krona climbed for a third straight day, appreciating 0.2 percent to 6.3126 against the dollar. It advanced 0.4 percent to 8.9696 versus the euro. Sweden’s central government surplus will be 99 billion kronor ($15.7 billion), or about 3 percent of gross domestic product, the National Debt Office said in a report. The surplus will narrow to 68 billion kronor in 2012. That compares with a November estimate for surpluses of 18 billion kronor in 2011 and 78 billion kronor in 2012. Norway’s krone gained 0.1 percent to 5.5757 per dollar and advanced 0.2 percent to 7.9138 against the euro as crude oil increased for the first time in three days. Crude oil for June delivery advanced 1.3 percent to $98.12 a barrel in New York. The Stoxx Europe 600 Index climbed 0.2 percent. Standard & Poor’s 500 Index futures rose 0.1 percent. To contact the reporter on this story: Lukanyo Mnyanda in Edinburgh at lmnyanda@bloomberg.net To contact the editor responsible for this story: Daniel Tilles at dtilles@bloomberg.net

Source