Euro climbs to two-week high supported by Italy and oil

The euro hit its highest level in two weeks on Monday as risk appetite increased due to rising oil prices and information that Italy could reduce its price. target budget deficit to appease the EU.

Developments in Italy and the news of the UK and EU agreement on secession have helped the European currency to overcome the impact of disappointing data on the sentiment of German companies.

Sterling rose about a third to one percent to 1.2880 dollar after Sunday's deal on the UK's exit from the European Union,

But currency gains have been limited by doubts about Prime Minister Teresa Mae's ability to approve the deal in a torn parliament, Reuters said.

The single currency grew by about a third of a percent to 1.1358 dollar and rose 0.5% to 128.65 yen, while the euro reached its highest level in two weeks against the dollar at $ 1.1442 last week.

Two government sources said Monday,

Italy could reduce the target budget deficit next year to 2% of GDP in order to avoid punitive measures on the part of Brussels.

The dollar index, which tracks the performance of the greenback versus a basket of major currencies, declined 0.2% to 96.73.

Another sign of improving investor appetite for risk, the yen has traded at 113.18 yen to the dollar, down 0.2% from the greenback, while that the Australian dollar has appreciated 5% to 0.7261 USD, up from 0.7202 USD last week.

The Norwegian krone was supported by a recovery in oil prices as the currency rose 0.5% to 8.55 kronor per dollar.