The euro rose versus most of its major peers after the results of European Central Bank stress tests eased concern that some of the region’s lenders’ balance sheets were too weak.
The single currency strengthened to a two-week high versus the yen before a report today from the Ifo institute forecast to show business confidence stabilized in Germany, the currency bloc’s biggest economy. Australia’s dollar and the Korean won gained along with regional stocks. The greenback weakened amid declining bets for an early interest-rate increase by the Federal Reserve.
“If the Ifo survey comes in as the market expects, worries about Germany will be scaled back, and the euro will rise,” said Toshiya Yamauchi, a senior analyst in Tokyo at Ueda Harlow Ltd., which provides margin-trading services. “The results of the stress tests have already relieved some concerns.”
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