Euro surges on ECB comments

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The euro rose against the dollar in Asia on Monday after the European Central Bank chief's positive comments last week about the beleaguered eurozone's outlook, analysts said.

The euro was at $1.3394 in morning Asian trade Monday as compared to $1.3341 in the US late Friday. The US dollar was at 89.53 yen from 89.18 yen, and the euro traded at 119.92 yen from 119.00 yen.

Traders piled into the euro after ECB chief Mario Draghi said Thursday there was “a significant improvement in financial market conditions” in the single currency bloc, analysts said.

“Euro leaders are getting far more confident and vocal that the end is in sight for the eurozone crisis... The single currency has taken the bait,” IG markets said in a report.

Among a long list of positives, Draghi pointed to lower bond yields, higher stock prices, record-low volatility, strong capital inflows into the eurozone, a halt of deposit flight in peripheral countries and a reduction of the ECB's balance sheet.

The ECB also held its key interest rate steady at its historic low of 0.75 percent.

The yen's continued slide against the dollar and euro followed the Japanese government's announcement of a stimulus package worth hundreds of billions of dollars on Friday. - Sapa-AFP


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