Investing.com - The euro strengthened against the dollar on Thursday after the International Monetary Fund said it would consider boosting its lending arsenal by $500 billion, fueling hopes that light will soon appear at the end of the tunnel in Europe.
EUR/USD hit 1.2869 in early Asian trading on Thursday, up 0.04%, up from a session low of 1.2852 and off from a high of 1.2870.
The pair likely tested support at 1.2852, the earlier session low, and resistance at 1.2878, last Friday's high.
Earlier, the IMF said it might expand its lending capacity by $500 billion and help firewall the European debt crisis, which has resulted in a slew of credit downgrades across the continent.
"The talk that the IMF is looking to shore up its lending capacity, the talks resuming between Greece and its creditor banks, all those things are having a little bit of a calming influence on the euro today," said Carl Forcheski, a director on the corporate currency sales desk at Societe Generale in New York, according to Bloomberg.
"The overwhelming feeling is that the euro is vulnerable to the downside."
Greece continued talks with private creditors and hopes are rising the two sides will strike a deal, with Bloomberg reporting that deal may see Athens providing its lenders with cash and securities with a market value of 32 cents per euro of government debt.
Greece has to strike a deal with creditors to restructure its debt if it wants to tap fresh bailout money and avoid defaulting on a EUR14.4 billion bond redemption coming due on March 20.
The World Bank, meanwhile, cut its global growth forecast to 2.5% for 2012, down from a June forecast of 3.6%, adding the eurozone could contract 0.3% while the U.S. should grow 2.2%.
Germany shaved its 2012 growth forecasts to 0.7% from 1%.
Lastly, U.S. home builder confidence hit the highest level since June, 2007, which may give the greenback room to rebound if hopes don't turn into reality in Greek debt restructuring talks.
The euro was up against the pound but down against the yen, with EUR/GBP rising 0.06% to 0.8337 and EUR/JPY falling 0.02% at 98.81.
Investors are awaiting U.S. inflation data, initial jobless claims as well as numbers on housing starts and building permits later Thursday, while the Federal Reserve Philadelphia Manufacturing Index will come out as well.
The European Central Bank will release a report on current account data followed by its monthly bulletin.
EUR/USD hit 1.2869 in early Asian trading on Thursday, up 0.04%, up from a session low of 1.2852 and off from a high of 1.2870.
The pair likely tested support at 1.2852, the earlier session low, and resistance at 1.2878, last Friday's high.
Earlier, the IMF said it might expand its lending capacity by $500 billion and help firewall the European debt crisis, which has resulted in a slew of credit downgrades across the continent.
"The talk that the IMF is looking to shore up its lending capacity, the talks resuming between Greece and its creditor banks, all those things are having a little bit of a calming influence on the euro today," said Carl Forcheski, a director on the corporate currency sales desk at Societe Generale in New York, according to Bloomberg.
"The overwhelming feeling is that the euro is vulnerable to the downside."
Greece continued talks with private creditors and hopes are rising the two sides will strike a deal, with Bloomberg reporting that deal may see Athens providing its lenders with cash and securities with a market value of 32 cents per euro of government debt.
Greece has to strike a deal with creditors to restructure its debt if it wants to tap fresh bailout money and avoid defaulting on a EUR14.4 billion bond redemption coming due on March 20.
The World Bank, meanwhile, cut its global growth forecast to 2.5% for 2012, down from a June forecast of 3.6%, adding the eurozone could contract 0.3% while the U.S. should grow 2.2%.
Germany shaved its 2012 growth forecasts to 0.7% from 1%.
Lastly, U.S. home builder confidence hit the highest level since June, 2007, which may give the greenback room to rebound if hopes don't turn into reality in Greek debt restructuring talks.
The euro was up against the pound but down against the yen, with EUR/GBP rising 0.06% to 0.8337 and EUR/JPY falling 0.02% at 98.81.
Investors are awaiting U.S. inflation data, initial jobless claims as well as numbers on housing starts and building permits later Thursday, while the Federal Reserve Philadelphia Manufacturing Index will come out as well.
The European Central Bank will release a report on current account data followed by its monthly bulletin.