The euro rose to a seven-month high against the yen after a report showed Australia's economy unexpectedly expanded last quarter, boosting demand for higher- yielding currencies.
Australia's dollar strengthened against all of the 16 most- traded currencies as Asian stocks rose after the report added to evidence the worst of the global recession may be over. The yen erased earlier gains after a Bank of Japan official signaled interest rates may stay low for some time. The Dollar Index traded close to the lowest level this year on concern the greenback will lose its role as the world’s reserve currency.
The euro rose to 137.87 yen as of 7:47 a.m. in London, from 136.97 yesterday in New York. It earlier climbed to 137.98 yen, the strongest level since Oct. 20. The European currency climbed to $1.4335 from $1.4303. Japan's currency dropped to 96.19 per dollar from 95.76.
The Australian currency gained 0.6 percent to 82.56 U.S. cents and rose 1 percent to 79.40 yen. It earlier reached 82.63 U.S. cents, the strongest level since Sept. 29.
The Dollar Index, used by the ICE to track the greenback against the euro, yen, pound, Swiss franc, Canadian dollar and Swedish krona, traded at 78.448 from 78.404 yesterday, when it fell to 77.334, the lowest since Dec. 18.
