The euro traded near the highest level in more than a week before manufacturing and services data that may add to evidence of the region’s strengthening recovery from a six-quarter contraction.
The 17-nation currency rose versus the yen after Germany’s Bundesbank said the European Central Bank may raise interest rates if inflation pressure mounts, boosting bets on an increase in borrowing costs tracked by Credit Suisse Group AG toward a 1 1/2-month high. The dollar held gains versus most major peers after benchmark Treasury yields climbed to a two-year high, as investors await clues on the timing of a reduction in central bank easing in meeting minutes due tomorrow.
“Euro strength has coincided with the first quarter of positive growth in six quarters,” said Andrew Salter, a currency strategist at Australia & New Zealand Banking Group Ltd. (ANZ) in Sydney. There are “some signs growth is starting to stabilize.”
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