The euro climbed to the highest level in more than
three weeks against the dollar and the U.K. pound after German business
confidence unexpectedly increased.
The euro also advanced against the Japanese yen after the Munich-based
Ifo institute said its business-climate index rose in May, giving the
European Central Bank more reason to raise interest rates. The yen rose
to the highest in more than a week against the dollar as a decline in
Asian stocks prompted investors to pare holdings of higher-yielding
assets funded in the Japanese currency.
The yen rose the most against the Brazilian real and the British pound
on concern oil prices close to $130 a barrel and the collapse of the
subprime-mortgage market will hamper global growth.
The minutes of the Fed's April 30 meeting, to be released today, may
show policy makers voiced concern about a slowing economy. Central
bankers at that session cut the benchmark interest rate for overnight
loans between banks by a quarter- percentage point to 2 percent.
The dollar may fall to 102.57 yen later today according to the
technical analysis of its price chart, said Pak Lai Ng, a technical
analyst at Forecast Singapore Pte.
The currency is likely to extend declines after breaking below a trend
line connecting its 12-year low of 95.76 yen on March 17 and its May 12
low of 102.57 yen, Ng said. Failure of first support at this low would
trigger a double top pattern, suggesting the dollar may then fall to
100 yen in the next two weeks, he said. Support is a level where buy
orders may be clustered.