Forex Pros – The euro extended gains against the U.S. dollar on Thursday, rising to a fresh four-day high after reports that China is interested in buying bailout bonds for Portugal but concerns over Greek debt continued to unsettle investors.
EUR/USD hit 1.4195 during European late morning trade, the pair’s highest since May 20; the pair subsequently consolidated at 1.4175, gaining 0.62%.
The pair was likely to find support at 1.4001, Tuesday’s low and resistance at 1.4345, the high of May 20.
The single currency found support after European Financial Stability Facility Chief Executive Officer Klaus Regling said China was “clearly interested” in buying Portuguese bailout bonds when the EFSF sells them in June.
Meanwhile, hopes for a rate hike by the European Central Bank this year were reignited after Executive Board member Juergen Stark said Wednesday that the goal of preventing a financial meltdown had been achieved and “the time has come to return to normal.”
However, investors remained concerned about the possibility of Greek debt restructuring, as well as uncertainty over whether Greece will agree new austerity measures and the potential for contagion into the likes of Spain and Italy.
The euro was also higher against the pound, with EUR/GBP rising 0.43% to hit 0.8693.
Later Thursday, the U.S. was to publish revised government data on first quarter economic growth as well as a weekly report on initial jobless claims.
ForexPros.com
