AFP - The euro briefly topped 1.30 dollars on Tuesday, nearing a 10-week high point as the US currency was plagued by renewed concerns over the US economic outlook.
In early trading, the shared eurozone unit struck 1.3029, the highest point since May 10. It later pulled back to 1.2976 dollars, up from 1.2943 dollars in New York late on Monday.
Against the Japanese currency, the dollar increased to 86.90 yen from 86.68 yen on Monday.
"The euro has risen again against the dollar ... as concern that the US recovery is floundering diminished appetite for the greenback as a haven," said TorFX analyst Adam Solomon.
CMC Markets analyst Michael Hewson added that sentiment remained upbeat ahead of publication later this week of the results of stress-tests on the European banking sector.
"The euro ... was able to shrug off the problems in Hungary, and the Moody's downgrade of Ireland, and continue to push higher on optimism about this week's stress test results," he noted.
The tests are to determine if the banks are strong enough to withstand fresh shocks or need more capital.
The dollar slid after Monday's pessimistic report on the US home-building industry added to concerns that economic recovery in the world's largest economy could stall.
The National Association of Home Builders' monthly index gauging confidence in new-home sales fell to a 15-month low of 14 points in July, down from 16 in June. Any reading below 50 signals market conditions are poor.
Barclays Capital chief Japan strategist Masafumi Yamamoto said investors would meanwhile pay attention to US firms' results and economic reports including housing data due this week.
Sterling was pushed lower by disappointing British government borrowing data.
The pound sank to 1.5155 dollars in late morning deals, hitting the lowest point since July 13.
British public sector borrowing was higher than expected in June, official data showed on Tuesday, in a blow to government hopes of slashing the huge public deficit.
The public sector sector net borrowing requirement, the state's preferred measure of public finances, stood at 14.5 billion pounds (17 billion euros, 22 billion dollars), the Office for National Statistics said in a statement.
The reading was worse than market expectations for a deficit of 13.5 billion pounds.
In London trading, the euro changed hands at 1.2976 dollars against 1.2943 dollars on Monday, at 112.76 yen (112.19), 0.8517 pounds (0.8500) and 1.3644 Swiss francs (1.3655).
The dollar stood at 86.90 yen (86.68) and 1.0515 Swiss francs (1.0548).
The pound was at 1.5235 dollars (1.5225).
On the London Bullion Market, the price of gold firmed to 1,181.73 dollars an ounce from 1,181 dollars an ounce on Monday.
