Euro rises to three-week high versus dollar on greek debt, ecb

The euro touched the highest in almost three weeks against the dollar on prospects the European Central Bank will increase interest rates next week to curb inflation and as European ministers are set to approve the next aid payment due to Greece.

Riskier assets advanced against the Swiss franc and the dollar after German financial firms agreed to roll over Greek debt holdings. Greek Prime Minister George Papandreou won approval of a second bill to authorize his 78 billion-euro ($113 billion) package of budget cuts and asset sales, a key to receiving further international financial aid. The Dollar Index fell even as the Federal Reserve ended its second round of quantitative easing.

“The euro is higher after Greece passed the implementation bill for austerity measures this morning, providing a bit more relief,” said Charles St-Arnaud, a foreign-exchange strategist at Nomura Holdings Inc. in New York. “Greece seems to have accepted it needs to tackle its problem and bank rollovers are leading to better sentiment.”

The euro rose 0.5 percent to $1.4502 at 5 p.m. in New York. It touched $1.4538, the highest level since June 10. The euro gained 0.2 percent versus the Japanese currency to 116.84 yen. The euro gained 0.7 percent against the dollar this month and is up 2.4 percent in the quarter that ends today.

Source: Businessweek.com