Euro Rises for Second Day

The euro rose vs the dollar for a second day on speculation the region's interest-rate advantage over the U.S. will draw investors after ECB officials signaled a cut in borrowing costs is unlikely.

The euro traded at a four month-high against the British pound after ECB policy makers Axel Weber and Lucas Papademos said yesterday that rates may have to rise as the economy recovers. The U.S. dollar fell for a second day against the yen as the price of oil climbed, threatening economic growth in the largest energy consumer.

The euro rose 0.3 percent to $1.4772 by 7 a.m. in New York, from $1.4727 yesterday. The currency was little changed at 161.32 yen. Against the pound, it appreciated 0.3 percent to 80.49 pence, near a record high of 80.99 pence on April 16. The dollar fell to 109.19 yen, from 109.49 yen.

The euro stayed higher after a government report showed unemployment fell in Germany in August by an adjusted 40,000, more than expected by economists and pushing the jobless rate to the lowest level in 16 years.

Euro Rises for Second Day, Bloomberg
8/28/2008 6:13:59 AM