venerdì 28 settembre 2012

Euro Climbs Against Dollar on Spain; Yuan Rises

The euro advanced for a second day against the dollar after Spain’s pledge to meet its deficit target improved prospects for an international rescue that may help stem Europe’s financial turmoil.


Europe’s shared currency also appreciated for a second day against the yen after data showed German retail sales rose more than forecast in August. The dollar weakened against 14 of its 16 major counterparts before a report forecast to show consumer spending probably stagnated in August, after adjusting for inflation. China’s yuan rose to the strongest level against the dollar since the nation unified official and market exchange rates at the end of 1993.
“Optimism is on the up again, because Spain’s budget shows a willingness to compromise, and this is helping the euro,” said Carolin Hecht, a currency strategist at Commerzbank AG in Frankfurt. “In terms of sustainability of this move we see many risks, because the past has shown that Spain is likely to miss its targets.”
The euro advanced 0.2 percent to $1.2935 at 7:46 a.m. London time, trimming its weekly decline to 0.4 percent. It rose less than 0.1 percent to 100.26 yen, on track for a 1.2 percent drop over the week. The yen advanced 0.1 percent to 77.51 per dollar after earlier touching 77.44, the strongest since Sept. 13.
Europe’s 17-nation currency will end the year at $1.23, Hecht predicted, because risks, including the prospect of Spain’s credit rating being reduced to non-investment grade, or junk status, will cause it to weaken.
Moody’s Investors Service said Aug. 30 that it would probably extend its review of Spain’s credit rating, which started June 13, through the end of this month in order to get more information on support measures for the nation. Moody’s currently ranks Spain at Baa3, one step above junk.
China’s yuan rose as much as 0.3 percent to 6.2856 per dollar.