PRODUCT PROFILE

Latest Dublin Prices

Euro soars to 6-week high but cautious

Monday, December 03 15:43:59

The euro leaped to its highest level against the U.S. dollar in six weeks today as concerns abated about debt-burdened Greece and Spain while Chinese data allayed worries about global economic growth.

The single currency shared by 17 countries, which was already gaining on signs Germany may be open to a Greek debt write-down, hit new highs after Spain formally asked for European funds to recapitalise its banking sector.

Demand for euros was also buoyed by economic data out of the region.

German Chancellor Angela Merkel said on Sunday Greece's creditors may look at writing down more of its debt, a move that would make the country's debt burden more easily sustainable.

Greece said it would spend 10 billion euros to buy back bonds at a price range that topped market expectations, boosting hopes it can cut its ballooning debt and unlock long-delayed aid. A successful buyback is central to the efforts of Greece's foreign lenders to put the near-bankrupt country's debt back on a sustainable footing and would clear the way for the funding Athens needs to avoid running out of cash.

"The successful completion of the repurchase will unlock bailout cash from the IMF and help secure the flow of rescue funds from the so-called "troika" in 2013," said Ilya Spivak, currency strategist at DailyFX in New York.

Greece's "troika" of lenders includes the International Monetary Fund, European Union and the European Central Bank.

"Confidence may be threatened as the closely-watched U.S. ISM print comes across the wires," Spivak said.

The euro climbed to $1.3073, its highest since Oct. 23, before paring gains to last trade up 0.4 percent on the day at $1.3038. (C ) Reuters