© Reuters. The euro rose further as concerns about Italy dissipates
Investing.com – The euro rose on Thursday, building on the strong results of the previous session, in a climate of optimism that the political stalemate that grips Italy can be resolved in the course of new elections.
The EUR / USD rose 0.2% to 1,1686 at 03:26 AM (07:26 GMT), extending its recovery from a ten-month low of 1,1509.
The single currency has been boosted by new attempts of the political parties anti-establishment Five Star and Lega to revive their plans for the coalition, which has eased fears that elections could enable the country to leave the euro zone.
The Italian rates have declined after rising sharply on Tuesday, but investors remained cautious because of the risk policy in the euro area remained high. In Spain, Prime minister Mariano Rajoy faces a confidence vote Friday.
On Friday, the temporary exemption from the EU regarding the taxes in the us on the steel and aluminium is due to expire. This nourishes the lingering concerns about a trade conflict between the United States and China, as well as the situation in North Korea.
Investors expect the data on inflation in the euro zone later in the day, after inflation in German was higher than expected on Wednesday, thus fuelling the problems that the european central Bank is facing as it debates its stimulus program.
The euro declined against the yen, with EUR / JPY at 126.93 after an increase of 1.04% on Wednesday.
The dollar declined against the yen, with USD / JPY sliding 0.27% to 108,62, returning to a low of five months of 108,10 Tuesday, as risk aversion supported the japanese currency.
The pound sterling has increased, with GBP / USD rising 0.2% to 1,3313 after having reached a low of six months to 1,3203 Tuesday, under pressure from the political risk in the euro area.
The dollar index, which measures the strength of the dollar against a basket of six major currencies, lost 0.17 per cent to 93,89, away from the highs of a seven-month 94,98 reported Tuesday.