“The euro rose against the dollar as German business confidence unexpectedly stayed near a record in May, fueling bets that theEuropean Central Bank will resume raising interest rates even as the debt crisis intensifies.
Europe’s common currency snapped two days of losses against the yen. The Ifo institute in Munich said its business climate index, based on a survey of 7,000 executives, held at 114.2 from April after economists forecast a decline to 113.7. The pound fell versus the euro after Moody’s Investors Service placed U.K. financial institutions on review for downgrades and Britain posted a larger budget deficit than predicted.”
“The euro weakened for a third day against the yen on speculation Europe’s sovereign-debt crisis is worsening and as the region’s industrial expansion slows.
Europe’s common currency approached a nine-week low against the dollar before a report that economists said will show the region’s industrial orders fell in March. The pound fell versus all 16 of its major counterparts after Moody’s Investors Service placed 14 U.K. financial institutions on review for possible downgrade. New Zealand’s dollar rose as company executives raised their expectations for inflation.
“Not only are the sovereign-debt concerns weighing on the euro, there’s the additional headache of weaker data now which is adding to the selling pressure,” said Mike Jones, a currency strategist at Bank of New Zealand Ltd. in Wellington. “With uncertainty now seemingly pervading the outlook, you’re going to see support for the yen on a safe-haven basis.”
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