Forexpros – The euro was higher against the U.S. dollar on Monday, amid hopes that European Union leaders are moving closer to a deal to recapitalize European lenders and ensure Greece remains in the single currency bloc.
EUR/USD hit 1.3492 during late Asian trade, the daily high; the pair subsequently consolidated at 1.3474, surging 0.72%.
The pair was likely to find support at 1.3241, last Thursday’s low and resistance at 1.3600, the high of September 30.
German Chancellor Angela Merkel and French President Nicolas Sarkozy said after talks on Sunday that they will present a “comprehensive” package of new measures to tackle the debt crisis in the euro zone.
The measures are believed to include plans to provide fresh capital to Europe’s banks and proposals to coordinate the national budget policies between euro zone member states.
However, few concrete details of the plan were announced and a deal is not expected to be reached until a meeting of G20 members next month.
The euro was also higher against the pound, with EUR/GBP rising 0.57% to hit 0.8646.
Also Monday, troubled Franco-Belgian lender Dexia agreed to the nationalization of its Belgian banking division, following fears that it could go bankrupt.
Ratings agency Moody’s has warned that the burden of the bailout of the bank could lead to a ratings downgrade on Belgian government bonds.
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