RTTNews - The euro gained on other majors Thursday amid higher risk-appetite as the British Chambers of Commerce indicated it sees growing signs that the worst phase of the recession is in the past. With the gain, the common currency moved further off of recent lows against its rivals.

The European currency rallied sharply in against the dollar after rallying in Asian trading and reached a four-day high. The single currency also hit near-term highs against the pound, yen and franc.

Meanwhile, European Commission president Jose Manuel Barroso, who is seeking a second term, sent a letter to European leaders gathering in Brussels for a summit Thursday, emphasizing the need for ensuring a strong European Union and a strong European Commission in times of crises.

The euro touched the 1.4000 mark against the dollar in late morning trading but has been unable to break above that key barrier. The overnight surge moved the common currency further away from a recently-visited 3 1/2-week low of 1.3747.

The euro rose to an eight-day high of 0.8604 against the sterling but later eased back to 0.8540. Earlier this week, the single currency it a 6 1/2-month low of 0.8418.

The UK economy is now expected to shrink 3.8% this year compared to its earlier estimate of 2.8% contraction. A very small growth of 0.6% is expected for 2010. This compares with an 0.8% increase predicted in March.

The euro climbed to as high as 134.72 against the Japanese yen. The rise took the European currency off a three-week low of 132.34 reached earlier in the week.

Against the Swiss franc, the euro turned sharply higher and reached an eight-day high of 1.5145. About three-hours earlier, the euro had hit a three-month low of 1.5005. Earlier, the Swiss National Bank announced it will keep its key interest rate unchanged at 0.25%.

In the Eurozone, Italy's trade deficit decreased to EUR277 million in April from EUR1.02 billion in the previous year, the country's statistical office ISTAT said today. Economists expected a deficit of EUR250 million.

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