Chinese data today encouraged a little risky trading, helping the euro to creep closer to a five-month high against the struggling US dollar, as well as the Australian dollar gaining on the US.
The US dollar took a .01 dip against the yen to touch 83.47 yen, but did not go so low as the 83.00 yen that was seen earlier last month and which prompted the Japanese authorities to intervene in the monetary system for the first since 2004.
With the US struggling with unemployment and low inflation, the good figures coming out of China contrasted strongly and helped investors rally in Friday with the evidence that China’s economy was pulling out of a second-quarter slump nicely.
The euro also rose to near a five month peak to hit $1.3663 on Friday. This rise was helped along by data showing that banks in the euro zone are relying less and less on funding from the European Central Bank. This rise comes off the back of a slump in June, but since then the euro has gained 15 percent on the dollar.
The Australian dollar also rallied on Friday to hit $0.9668 against the US dollar, a little short of the two-year high it reached on Thursday of $0.9734. Increased demand for Australian resources as well as higher interest rates sparked the increase.
Data released on Thursday showed that joblessness in the US had eased marginally, but analysts are still wary and watching closely ahead of speculation the Federal Reserve plans to implement quantitative easing.
