Forexpros – The euro extended gains against the U.S. dollar on Thursday, advancing to a four-day high as optimism that Greece will be able to finalize a debt swap with private bondholders buoyed the currency ahead of a rate decision by the European Central Bank.
EUR/USD hit 1.3264 during European afternoon trade, the pair’s highest since March 2; the pair subsequently consolidated at 1.3254, advancing 0.80%.
The pair was likely to find support at 1.3095, Wednesday’s low and a three-week low and resistance at 1.3331, the high of March 2.
Sentiment on the euro strengthened after reports that a number of major European financial institutions had signed up to Greece’s bond swap deal, which is aimed at writing down 53.5% of the country’s EUR177 billion debt.
Major Greek banks, along with most pension funds, have also agreed to participate in the bond swap.
A positive outcome should clear the way for Greece to tap a second bailout package and avert a messy debt default.
The euro also found support after data earlier showed that German industrial production rebounded in January after a steep drop the previous month, climbing 1.6% and surpassing expectations for a 1.1% increase.
In addition, the euro was higher against the pound and the yen, with EUR/GBP up 0.40% to hit 0.8385 and EUR/JPY jumping 1.53% to hit 108.24.
Later Thursday, the ECB was to hold its policy setting meeting, which was to be followed by a closely watched press conference. In addition, the U.S. was to produce government data on initial jobless claims.
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