Euro Edges Higher Versus Dollar, Falls Against Yen

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The euro saw choppy trading versus major rivals on Tuesday in New York as a mixed bag of economic reports from around the globe limited risk appeal.

The German economy expanded 0.7% in the third quarter from the previous quarter, following the 0.4% increase seen in the second quarter, a detailed report from the Federal Statistical Office revealed Tuesday.

German business climate index rose to 93.9 in November from 91.9 recorded in October, Ifo Institute for Economic Research said Tuesday. Economists had forecast an increase to 92.5.

Eurozone industrial new orders decreased 16.5% year-on-year in September, compared to the 23.2% fall in the previous month, revised from 23.1% decline reported initially. Economists expected a decline of 17.3%.

The euro was slightly higher amid choppy trading versus the U.S. dollar, moving near 1.4960. Yesterday, the European currency climbed as high as 1.4998, challenging the 15-month high of 1.5062.

The euro gave back its gains against the sterling after earlier rising to a 12-day high. The 16-member currency reached as high as 0.9055 before slipping back toward 0.9000.

Bank of England Governor Mervyn King said in a hearing before the Treasury Committee that there are signs that a recovery will soon be underway in the UK. But, the recession means that level of spending is now markedly lower than it was in the first half of 2008, the central bank chief said. Looking ahead, he said, the economy continues to face profound challenges.

The euro slipped to the lower end of a trading range against the Japanese yen, moving near 132.30.

The German business climate index rose to 93.9 in November from 92 recorded in October, the Munich-based Ifo Institute for Economic Research said. Economists had forecast an increase to 92.5.

The French business confidence indicator stood at 89 in November, unchanged from October, statistical office Insee said Tuesday. Economists had forecast a reading of 91.

European Central Bank Governing Council member Jose Manuel Gonzalez-Paramo said in an article published in the Financial Times on Tuesday the Eurosystem has already taken some steps to simplify the structures of asset-backed securities which it accepts as collateral.

(Market News Provided by RTTNews)