Euro exceeds $ 1.22 for first time in more than two years

LONDON (Reuters) – Strong figures from the eurozone investigation and hopes for progress in Brexit negotiations pushed the euro above $ 1.22 against the US dollar on Wednesday for the first time since April 2018.

The euro has been advancing since the European Union announced a stimulus fund in May, rising nearly 13% since then. Data on economic activity in recent months has also boosted bets that Europe is outperforming the United States

These expectations have been bolstered with data from manufacturing industry surveys in Germany and France, indicating that Europe’s largest economies could recover quickly. and

Against the US dollar, the euro rose 0.4% to $ 1.22065, putting it on track for its biggest annual gain since 2017.

“European PMIs, Brexit and a likely accommodating Fed are stimulating risk appetite in currency markets,” said Kenneth Broux, strategist at Societe Generale in London.

The European Union’s chief executive said she could not say whether the EU and Britain would come to a trade deal, but progress had been made and the next few days would be crucial.

Investors are also monitoring the results of a two-day Federal Reserve policy meeting on Wednesday. Policymakers should keep the overnight interest rate close to zero and signal that it will stay there for years to come, a move that analysts say will further boost risk sentiment.

“There is a feel-good dynamic in the market,” said Bart Wakabayashi, director of the Tokyo branch of State Street Bank in Tokyo.

The dollar index, which measures the US currency against a basket of currencies, was the latest at 90.127, a level not seen since April 2018.

The Australian dollar was little changed at 75.75 US cents AUD = D4, approaching a two-and-a-half-year high of 75.780 which it hit on Monday.