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Euro jumps 1% as markets, gold rebound

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(Globalpost/GlobalPost)

The euro jumped one percent against the dollar, reaching its best level since February, on Tuesday and the yen fell as buyers returned to share markets and gold rebounded following Monday's rout.

Safe-haven currencies the yen and dollar suffered from the return to risk, with the euro trading at $1.3180 at 2200 GMT, up from $1.3036 late Monday.

The yen fell, with the dollar buying 97.79 yen compared to 96.72 Monday, and the euro pushing to 128.86 yen from 126.05 yen.

After losing nine percent in one day, gold prices bounced back $40 to the $1,400 an ounce level before slipping back to $1,372.

The recovery came a day after a deep plunge in markets and commodities spurred by poor Chinese growth data and then the bombings in Boston, which killed three people.

"The euro-US dollar took its cue from US equities, which recovered strongly today," said Kathy Lien of BK Asset management.

"The improvement in risk appetite even helped the euro shrug off the news that German investor confidence deteriorated significantly," she said.

"It should be no surprise that $1.3150 is a key level... and when it was finally broken, the currency pair jumped above $1.3180 in a matter of minutes."

With no eurozone data slated for release Wednesday, Lien said the sustainability of the euro rally will depend on US news, including company earnings and the trend for equities, and the release of the Federal Reserve's Beige Book update on regional economies.

The British pound also enjoyed a surge, jumping to $1.5367 from $1.5283, while the dollar fell to 0.9222 Swiss francs from 0.9312 francs.

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http://www.globalpost.com/dispatch/news/afp/130416/euro-jumps-1-markets-gold-rebound