Euro holds firm against US dollar


AFP

TOKYO–The euro held firm against the U.S. dollar in Asia on Friday after surging on investor relief over a deal between European leaders hailed as a major step towards resolving the eurozone debt crisis. The euro, which rose past US$1.42 overnight to hit its strongest level in eight weeks, bought US$1.4176 in Tokyo afternoon trade compared with US$1.4187 in New York late Thursday. The euro edged down to 107.58 yen from 107.73 yen in New York but was still sharply higher from levels in the 106-yen range a day earlier, helping boost Tokyo’s Nikkei index.

The dollar was trading at 75.88 yen, close to its latest post-war low of 75.66 yen touched in New York. “Confidence is restored as markets absorb the EU rescue package and buy into the broad measures wholeheartedly,” National Australia Bank said in a note. After 10 hours of painstaking talks in Brussels, banks holding some of Greece’s mountain of debt agreed to take a 50 percent “haircut” on their holdings, breaking a deadlock many hope will help end the 2-year-old crisis. The summit also established a fresh Greek bailout and a deal that will force lenders to increase their defenses against losses on the debt write-down, while more than doubling the capacity of a rescue fund aimed at protecting other eurozone economies. The euro rallied after the breakthrough deal.