Investing.com - The euro extended gains against the U.S. dollar and the yen on Tuesday, after stronger-than-forecast German business sentiment data indicated that the euro zone’s largest economy was performing strongly despite the effects of the region’s debt crisis.
During European late morning trade, the euro was sharply higher against the U.S. dollar, with EUR/USD jumping 0.93% to hit 1.2786.
The ZEW Centre said that its index of German business sentiment posted the largest ever recorded increase in January, jumping to minus 21.6, from the previous month’s reading of minus 53.8 and surpassing expectations for an increase to minus 49.2.
The ZEW index of economic sentiment in the euro zone also improved more-than-forecast in January, rising to minus 32.5 from minus 54.1.
A separate report showed that consumer price inflation in the single currency bloc rose less-than-expected in December, advancing 2.7% after a 2.8% rise the previous month.
The euro had found support earlier after better-than-forecast data on Chinese fourth quarter economic growth boosted demand for riskier assets.
The data came after ratings agency Standard & Poor’s downgraded the triple-A rating of the euro zone’s bailout fund by one notch on Monday, following Friday’s downgrade of nine euro zone sovereigns, including France.
The euro was also higher against the pound, with EUR/GBP advancing 0.49% to hit 0.8306.
In the U.K., official data showed that CPI rose 4.2% in December, in line with expectations, after a 4.8% increase the previous month.
The single currency was also higher against the safe haven yen, with EUR/JPY rallying 0.96% to hit 98.18, after falling to 97.04 on Monday, the pair’s lowest level since December 2000.
Earlier Tuesday, Bank of Japan Governor Masaaki Shirakawa met Prime Minister Yoshihiko Noda to discuss Europe’s debt crisis, amid concerns over the impact of the strong yen on Japan’s largely export based economy.
Elsewhere, the euro was steady against the Swiss franc, with EUR/CHF inching up 0.06% to hit 1.2094.
The euro continued to struggle close to record lows against the Australian and New Zealand dollars, with EUR/AUD slipping 0.14% to hit 1.2263 and EUR/NZD dipping 0.05% to hit 1.5952.
But the euro was higher against the Canadian dollar, with EUR/CAD adding 0.46% to hit 1.2952.
Later Tuesday, the U.S. was to produce a report on manufacturing activity in New York State.
During European late morning trade, the euro was sharply higher against the U.S. dollar, with EUR/USD jumping 0.93% to hit 1.2786.
The ZEW Centre said that its index of German business sentiment posted the largest ever recorded increase in January, jumping to minus 21.6, from the previous month’s reading of minus 53.8 and surpassing expectations for an increase to minus 49.2.
The ZEW index of economic sentiment in the euro zone also improved more-than-forecast in January, rising to minus 32.5 from minus 54.1.
A separate report showed that consumer price inflation in the single currency bloc rose less-than-expected in December, advancing 2.7% after a 2.8% rise the previous month.
The euro had found support earlier after better-than-forecast data on Chinese fourth quarter economic growth boosted demand for riskier assets.
The data came after ratings agency Standard & Poor’s downgraded the triple-A rating of the euro zone’s bailout fund by one notch on Monday, following Friday’s downgrade of nine euro zone sovereigns, including France.
The euro was also higher against the pound, with EUR/GBP advancing 0.49% to hit 0.8306.
In the U.K., official data showed that CPI rose 4.2% in December, in line with expectations, after a 4.8% increase the previous month.
The single currency was also higher against the safe haven yen, with EUR/JPY rallying 0.96% to hit 98.18, after falling to 97.04 on Monday, the pair’s lowest level since December 2000.
Earlier Tuesday, Bank of Japan Governor Masaaki Shirakawa met Prime Minister Yoshihiko Noda to discuss Europe’s debt crisis, amid concerns over the impact of the strong yen on Japan’s largely export based economy.
Elsewhere, the euro was steady against the Swiss franc, with EUR/CHF inching up 0.06% to hit 1.2094.
The euro continued to struggle close to record lows against the Australian and New Zealand dollars, with EUR/AUD slipping 0.14% to hit 1.2263 and EUR/NZD dipping 0.05% to hit 1.5952.
But the euro was higher against the Canadian dollar, with EUR/CAD adding 0.46% to hit 1.2952.
Later Tuesday, the U.S. was to produce a report on manufacturing activity in New York State.