The euro rose to a six-week high Friday as investors became more optimistic that Greece and its private-sector creditors would reach an agreement. Reports on the progress of the talks, including a comment on Friday by Finance Minister Evangelos Venizelos that Greece was one step away from concluding a deal on the EUR100 billion ($132 billion) debt write-down plan, helped build positive expectations. A deal has appeared close for much of the last week, but disagreements over coupon payments have stood in the way of an agreement.
The euro traded above $1.32 for the first time since Dec. 13, ending Friday at $1.3219, from $1.3108 a day earlier . The currency’s rise was briefly weakened after Fitch Ratings downgraded Italy, Spain, Belgium, Cyprus and Slovenia’s sovereign debt ratings. But Fitch reaffirmed its rating on Ireland, and left France and Germany untouched. The market is leaning toward getting positive news with regard to negotiations in Greece.
Earlier in the session on Friday, the dollar picked up some gains after the first reading on fourth-quarter GDP, showing the U.S. economy grew at 2.8%, below the consensus 3% forecast. Still, the rate of growth was the fastest in more than a year and a half. The JPY ended Friday stronger against the euro at Y101.45 from Y101.46, and at Y76.69 against the dollar, from Y77.46. The USD was at CHF0.9167 from CHF0.9204, while the GBP was at $1.5759 from $1.5688.
EasyForexNews Research Team