The euro climbed against the dollar after a report showed German first-quarter
economic growth accelerated to the fastest pace in 12 years, making it less
likely the European Central Bank will lower interest rates.
The euro traded near a one-week high versus the yen before a separate report that
economists estimate will show European consumer prices increased at a faster
rate than the ECB's target.
Gross domestic product in Germany, Europe's largest economy, rose 1.5%
from the fourth quarter, when it increased 0.3%, the Federal Statistics Office
in Wiesbaden
said today.
GDP in the euro area increased 0.5% from
the fourth quarter, according to a survey before data due today.
EUR/USD printed
lows near $1.5440 before it rose sharply to $1.5540.
GBP/USD also
strengthened from $1.9430 to $1.9470/80.
USD/JPY fell
from Y105.30 to Y104.50/60.
The U.S. dollar was little changed against the
yen before reports
that may show industrial production shrank, eroding expectations for the
Federal Reserve to raise interest rates. U.S. industrial production fell 0.3%
in April after a 0.3% gain in the previous month, according to a survey. A
separate report may show manufacturing in the Philadelphia area contracted for the sixth
month in May, another survey shows.
Futures on the Chicago Board of
Trade showed yesterday 92% odds that the Fed will hold its target lending rate
at 2% at its next meeting on June 25.