RTTNews - The euro surged higher versus the dollar on Friday after the European manufacturing industry showed signs of moderate growth for the first time in 15 months.

Stocks advanced on both sides of the Atlantic, fueling increased risk appetite and subsequently giving the euro a big boost.

The Eurozone private sector economy showed signs of broad stabilization as the Purchasing Managers' Index hit the threshold level for August. A return to growth in manufacturing output and slowing rate of contraction in the service sector led to the stabilization.

The Flash Eurozone Composite Output Index rose to 50 in August from 47 in July, a survey from the Markit Economics showed Friday.

The euro jumped to a 2-week high of 1.4375 versus the dollar, pulling up shy of an 8-month peak of 1.4446, set earlier this month.

The single currency hit a weekly high of 135.30 against the yen, and a monthly peak of 0.8678 versus the sterling.

In economic news from the US, Federal Reserve Chairman Ben Bernanke said Friday that the world is beginning to emerge from a deep recession that could have been decidedly worse had the U.S. and other countries not taken aggressive policy action.

After contracting sharply over the past year, economic activity appears to be leveling out, both in the United States and abroad, and the prospects for a return to growth in the near term appear good, Bernanke said.

Meanwhile, existing home sales increased by much more than expected in the month of July, according to a report released by the National Association of Realtors on Friday, with home sales rising for the fourth consecutive month.

The report showed that existing home sales rose 7.2 percent to an annual rate of 5.24 million units in July from a 4.89 million-unit rate in June. Economists had been expecting a more modest increase to a 5.0 million-unit rate.

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