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EUR/USD Rallies to 1.2650 as ECB’s Plan Skimped on Details

The euro climbed the most since March as the European Central Bank failed to provide details on the size of a plan to buy private debt, curbing bets it would expand the ECB’s balance sheet enough to weaken the currency.

The yen advanced as Japanese Vice Finance Minister Nobuhide Minorikawa said weakness in the currency is hurting some companies by driving up energy prices. Australia’s dollar rebounded from an eight-month low, while the pound fell and the U.S. currency declined. The euro gained from almost a two-year low as ECB President Mario Draghi unveiled plans to buy covered bonds and asset-backed securities for at least two years.

“It’s probably a relatively short-lived rally,” Jennifer Vail, head of fixed income at U.S. Bank Wealth Management in Minneapolis, said in a phone interview. “The next negative economic print is going to weigh on the euro again. I don’t think it has substantial legs. It’s kind of bouncing off the bottom.”

Bloomberg [1]

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