Euro Rises on Growth Outlook

The euro rose today to $1.27 for the first time since May 12th and gained versus the Japanese yen after the International Monetary Fund and the ECB President Jean-Claude Trichet said that the global economic growth accelerates.
The shared 16-nation European currency also strengthened on the speculation that the planned stress tests for the European banks might assume the loss of 17 percent on the Greek bonds, less then expected by some investors. According to the IMF forecast, the world economy would expand by 4.6 percent in this year, compared with the previous estimates of 4.2 percent. The European Central Bank kept its main interest rate at the lowest level for all times of 1 percent.

Jean-Claude Trichet, the President of the European Central Bank, said at the press conference today “indicators suggest that a strengthening in economic activity took place during the spring”. According to his opinion, the main refinancing rate is “appropriate” and the inflation outlook “remain firmly anchored”.
EUR/USD traded at 1.2675 as of 17:21 GMT after it opened at 1.2637. EUR/JPY traded at about 112.16 up from its opening level of 110.83.

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