Euro jumps on optimism over debt crisis

The euro on Wednesday rose to its highest level in nearly five months against the yen and also gained ground on the dollar in Asian trade, as worries over the eurozone’s debt crisis eased. The euro firmed to 110.90 yen in Tokyo morning trade from 110.66 in New York late Tuesday. That was its highest level since October 31 when the European unit jumped above 111.00 yen after a yen-selling intervention by Japan. The euro also rose to $1.3264 from $1.3222 in New York. The dollar was changing hands at 83.61 yen, almost flat from its level in New York. Europe’s single currency could flirt with its post-intervention high of 111.57 yen, said Junichi Ishikawa, forex analyst at IG Markets Securities in Tokyo. “The euro/yen’s upward momentum may well continue, likely testing 111.57 in the near term,” he told Dow Jones Newswires. Worries over Europe’s sovereign debts have diminished after Greece on Tuesday received a payment of 7.5 billion euros ($9.9 billion) under its second international bailout. The dollar may climb back above 84.00 yen if February home sales due to be released later Wednesday show further signs of improvement in the US housing market, said Masafumi Yamamoto, chief forex strategist at Barclays Capital. A Dow Jones survey of economists forecasts US existing home sales of 4.63 million, an increase of 1.3 percent from January. “We expect figures to surpass market expectations,” Yamamoto said.