RTTNews - A lukewarm reaction to U.S. Treasury Secretary Timothy Geithner's comments helped the euro to a multi-month high against the dollar on Wednesday in New York. Meanwhile, the euro remained near a multi-month low against the red-hot sterling.
Investors also mulled data showing the German producer price index fell more than expected to its lowest level since 1987 and awaited the release of the minutes from the latest Federal Open Market Committee meeting.
The euro surged against the greenback and reached its highest level in more than four months at 1.3793. The dollar fell across the board as markets failed to show much enthusiasm over Geithner's remarks.
The Treasury Secretary faced lawmakers Wednesday, updating them on the progress of the $700 billion TARP. Although the outlook is getting brighter, Geithner cautioned that it will take time for a full recovery.
The euro remained near a three-month low against the British pound, trading around 0.8770. If the common currency gets below 0.8763 it will reach its lowest mark since February.
The BoE minutes revealed that all the nine members of the MPC stood united while deciding to raise the asset purchase plan by GBP 50 billion to a total of GBP 125 billion. The central bank should seek to complete the GBP 125 billion of purchases within the next three months, the members concurred. The meeting was held on May 6 and 7.
The euro leveled off near a weekly high against the Japanese yen and moved near 131.00. The European currency reached a three-week low of 126.96 earlier in the week.
The Japanese economy contracted by a record 15.2% year-on-year in the first quarter after the revised 14.4% contraction in the previous quarter, the Cabinet Office said in a preliminary report. Economists had expected a 16.1% contraction.
In the Eurozone, Germany's Federal Statistical Office said PPI dropped 2.7% year-over-year in April, after falling 0.5% in March. This was the lowest annual rate of PPI since June 1987. Economists were looking for a decline of 1.3%. On a monthly basis, producer prices declined 1.4% in April, compared with a 0.7% fall in the preceding month.
Italy's current account deficit narrowed to EUR 2.27 billion in March from EUR 3.8 billion deficit in February and from EUR 6.3 billion deficit in the same month of the previous year, the Bank of Italy said.
Elsewhere, Italian statistical office Istat said industrial orders fell 2.7% month-on-month in March, taking the annual decline to 26%. Industrial turnover fell 0.8% from February, half of the expected 1.6% fall.
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