EUR/USD Above 1.12 on Fed Expectations

The euro jumped to a two-month high against the dollar on Thursday in a move that analysts said could be attributed to one key factor: a scaling back of U.S. rate hike expectations.

The single currency rose more than 1 percent on the day to about $1.1250 – its highest level since late February. It marks a change in course after falling for several months against a broadly robust dollar.

“The euro’s strength today is not about what’s boosting it but about what’s hurting the dollar,” Geoffrey Yu, a senior currency strategist at UBS, told CNBC.  “Federal Reserve rate hike expectations have taken a knock and the debate has switched from how many times will the Fed hike rates this year to if the Fed will hike rates this year.”