BLBG:Dollar Is Near Seven-Week High Versus Euro Before German Sentiment Report
The dollar was 0.2 percent from a seven-week high against the euro before a German report that may show a gauge of business confidence dropped for a fifth month, increasing the allure of the U.S. currency as a haven.
Europe’s common currency held a loss against the yen as Italy prepares to sell bills tomorrow after Germany failed to get bids for 35 percent of the 10-year government bonds that it offered for sale yesterday. The Australian dollar was within 0.1 percent of a one-month low against the yen on prospects Asian stocks will extend a global rout of equities.
“There will be a rush for safe havens like the dollar now,” said Kurt Magnus, executive director of currency sales in Sydney at Nomura Holdings Inc., Japan’s biggest brokerage. “It’s quite clear that the picture is deteriorating at a fast pace in the euro zone.”
The U.S. currency traded at $1.3346 per euro as of 8:17 a.m. in Tokyo from $1.3342 in New York yesterday when it reached $1.3320, the highest since Oct. 6. The euro was little changed at 103.16 yen after slumping 0.8 percent yesterday. The yen fetched 77.30 per dollar from 77.31.
The Australian dollar was little changed at 74.89 yen after sliding to 74.83 yesterday, the lowest since Oct. 10. The so- called Aussie was at 96.91 U.S. cents from 96.88 cents.
The Ifo institute’s business climate index for Germany dropped to 105.2 in November, the lowest since March 2010, according to the median forecast of economists in a Bloomberg News survey. The Munich-based group will release the data today.
Italy will sell 8 billion euros ($10.7 billion) of bills tomorrow. Yields on Germany’s 10-year debt soared 22.9 basis points, the biggest jump since 1990, amid doubts about the status of the securities as a haven from the region’s crisis.
The Standard & Poor’s 500 Index (SPX) of U.S. shares slid 2.2 percent yesterday. The Stoxx Europe 600 Index fell 1.3 percent.
To contact the reporters on this story: Masaki Kondo in Singapore at mkondo3@bloomberg.net; Mariko Ishikawa in Tokyo at mishikawa9@bloomberg.net.
To contact the editor responsible for this story: Rocky Swift at rswift5@bloomberg.net
