The euro was less than 0.1 percent from its highest in 3 1/2 months before European Central Bank executive board member Benoit Coeure speaks as expectations for lower benchmark interest rates in the region decline.
Europe’s common currency climbed 1.7 percent from before the ECB’s June 6 meeting through yesterday as short-term rates reached a four-month high. The yen fell against all its major counterparts, trimming its biggest gain against the dollar since 2010. Demand for the greenback was supported before a report tomorrow that may show sales at U.S. retailers rose by the most in three months. Australia’s dollar rebounded from the lowest in almost three years as consumer confidence rebounded.
“A gain in short-term rates is cause for euro buying,” said Masato Yanagiya, the New York-based head of foreign-exchange and money trading at Sumitomo Mitsui Banking Corp., a unit of Japan’s second-biggest financial group by market value. “The rising rates show expectations of a future rate cut by the ECB have receded.”
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