Investing.com - The euro gained ground against the dollar on Monday, boosted by a spike in German bund yields, while the dollar turned lower following a report, subsequently denied, that President Barack Obama had voiced concern over its strength.
EUR/USD was up 0.85% to 1.1208, recovering from Friday’s lows of 1.1048.
The euro moved higher as German 10-year bund yields climbed, re-approaching last week’s nine-month highs.
German bund yields act as benchmarks for European financial markets and higher yields push the euro higher against the dollar. Yields rise as prices fall.
The recent rally in bund yields has been spurred by signs of an economic recovery in the euro area.
But sentiment on the single currency remained fragile as a standoff between Greece and its lenders continued.
Earlier Monday German Chancellor Angela Merkel warned that “there isn’t much time left” to reach an agreement on a cash-for-reforms deal needed to unlock more financial aid before the country runs out of money.
Athens delayed a key debt payment to the International Monetary Fund on Friday, saying it would repay the money along with other payments due this month by the end of June.
The dollar remained broadly weaker following media reports earlier in the day that President Obama told the G7 summit in Germany that the strong dollar was ‘a problem.”
The White House later denied the president had made the comment.
USD/JPY slid 0.28% to 125.24, pulling back from the 13-year peaks of 125.84 struck in the wake of Friday’s above forecast U.S. jobs report.
The Labor Department reported that the U.S. economy added 280,000 jobs in May, well ahead of economists forecast for 220,000.
The upbeat data underlined the view that the economy is on track to rebound after a weak first quarter and bolstered expectations that the Fed could start to hike interest rates at its September policy meeting.
The yen showed little reaction after data released earlier on Monday showed that Japan’s gross domestic product was revised up to an annualized 3.9% in the first quarter from an initial estimate of 2.4% growth.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was down 0.58% to 95.82.