Investing.com - The euro rallied over 1% against the U.S. dollar on Friday, to reach 26-month highs following comments by European Central Bank Governing Council member Jens Weidmann.
EUR/USD hit 1.3894 during European afternoon trade, the pair's highest since October 2011; the pair subsequently consolidated at 1.3840, jumping 1.09%.
The pair was likely to find support at 1.3663, the session low and resistance at 1.4246.
The euro strengthened broadly after ECB Governing Council member Weidmann said keeping interest rates low may endanger political reforms.
According to Germany’s Bild newspaper, Weidmann said low inflation shouldn’t be used to justify loose monetary policy. "We must take care to raise interest rates again in a timely manner should inflation pressures build," he reportedly added.
The greenback had found support on Thursday after the U.S. Department of Labor said that the number of individuals filing for initial jobless benefits declined by 42,000 to a seasonally adjusted 338,000 last week. Analysts had expected U.S. jobless claims to fall by 35,000 to 345,000 from the previous week’s revised total of 380,000, which was the highest since March.
The upbeat data added to the view that the U.S. economy will be strong enough to allow the Federal Reserve to continue withdrawing stimulus through 2014.
The euro was also higher against the pound, with EUR/GBP up 0.35% to 0.8373.
Trading volumes were expected to remain light, with no major U.S. data to be released throughout the day.
EUR/USD hit 1.3894 during European afternoon trade, the pair's highest since October 2011; the pair subsequently consolidated at 1.3840, jumping 1.09%.
The pair was likely to find support at 1.3663, the session low and resistance at 1.4246.
The euro strengthened broadly after ECB Governing Council member Weidmann said keeping interest rates low may endanger political reforms.
According to Germany’s Bild newspaper, Weidmann said low inflation shouldn’t be used to justify loose monetary policy. "We must take care to raise interest rates again in a timely manner should inflation pressures build," he reportedly added.
The greenback had found support on Thursday after the U.S. Department of Labor said that the number of individuals filing for initial jobless benefits declined by 42,000 to a seasonally adjusted 338,000 last week. Analysts had expected U.S. jobless claims to fall by 35,000 to 345,000 from the previous week’s revised total of 380,000, which was the highest since March.
The upbeat data added to the view that the U.S. economy will be strong enough to allow the Federal Reserve to continue withdrawing stimulus through 2014.
The euro was also higher against the pound, with EUR/GBP up 0.35% to 0.8373.
Trading volumes were expected to remain light, with no major U.S. data to be released throughout the day.