(RTTNews) - The U.S. dollar surged higher against other major currencies in early European deals on Monday as traders bought safe haven assets after Moody's Investors Service said that it intends to review the ratings of all EU sovereigns during the first quarter of 2012.
The U.S. dollar is considered as one of the safe haven currency because of the nation's very low lending rate. The dollar tends to gain in times of financial turmoil and vice-versa.
Moody's warning came despite the EU leaders reaching an agreement last week over a set of new rules to tackle the region's lingering debt troubles.
The rating agency pointed out that there have been a continued absence of decisive policy measures despite the recent euro area summit.
"The absence of measures to stabilize credit markets over the short term means that the euro area, and the wider EU, remain prone to further shocks and the cohesion of the euro area under continued threat," Moody's said.
Though the Friday's policy announcements by EU leaders underlined the continued desire among euro area politicians to move towards centralized fiscal coordination and mutualization of resources and risks, it offers few new measures, the firm said. It also pointed out that many announcements were similar to previous ones.
Last week, the European Union agreed to establish a new "fiscal compact" to move towards a stronger economic union and budget discipline. But, the deal was rejected by the U.K., which was demanding protection for its financial sector.
The dollar is now trading at a 1-week high of 77.88 against the yen, compared to last week's close of 77.55. On the upside, 78.3 is seen as the next target level for the dollar.
Data from the Cabinet Office showed today that the seasonally adjusted consumer confidence index in Japan fell to 38.1 in November from 38.6 in October. Economists expected a more modest drop to 38.3. The unadjusted index showed a decline to 37.5 from 38.6 in October.
Against the euro, the dollar is presently trading at a 12-day high of 1.3260. The next upside target level for the dollar is seen at 1.321. At Friday's close, the euro-dollar pair was quoted at 1.3378.
Data released by the Federal Statistical Office showed that the German wholesale price index increased 4.9 percent annually in November, slightly slower than the 5 percent growth seen in October. In September, the rate of inflation was 5.7 percent. Inflation has been slowing regularly since March.
On a monthly basis, wholesale prices edged up 0.7 percent in November, recovering from the previous month's 1 percent decrease.
(RTTNews) - The dollar is currently trading at a 12-day high of 1.5542 against the pound and a 2-week high of 0.9303 against the franc. If the dollar gains further, it may likely target 1.550 against the pound and 0.933 against the franc. The pound-dollar and the dollar-franc pairs were worth 1.5662 and 0.9240, respectively at Friday's close.
The US dollar that closed Friday's trading at 1.0189 against the Canadian dollar is now trading at a 12-day high of 1.0270. On the upside, 1.030 is seen as the next target level for the greenback.
Against the Australian dollar, the U.S. dollar is trading at 1.0100, compared to Friday's closing value of 1.0215. The next upside target level for the greenback is seen at 1.005.
The U.S. dollar is currently worth 0.7660 against the New Zealand dollar. If the greenback advances further, it may likely target 0.764. The kiwi-greenback pair closed last week's trading at 0.7750.
Looking ahead, the U.S. monthly budget statement for November is due at 2 pm ET.
