EURUSD steadily climbed all day to hit a four week high in the US session as risk appetite held strong and investors were hopeful that the euro zone debt crisis will be under control as German Chancellor Angela Merkel made reassurances today of full ratification of the EFSF expansion by the EU Summit on October 23. Slovakia which voted against the bailout expansion has agreed to re-vote on Friday and are expected to ratify the new measures. European Commission President Jose Manuel Barroso called for a “coordinated approach” to recapitalize the region’s banks. Meanwhile the release of the minutes of the last US Fed meeting did not have much effect on the dollar which continued to weak in a risk-on market. EURUSD climbed to 1.3832 from 1.3770 US session open.
GBPUSD hit a one month high in New York trading, gaining 260 pips in the day. Cable peaked at 1.5797 before settling in a range, lifted by risk appetite.
The Swiss franc gained 190 pips against the US dollar, pushing USDCHF down to three-week lows at 0.8917 as the safe haven dollar was sold off in a risk-on environment today.
The Canadian dollar gained the most in more than two months versus its U.S. counterpart as optimism that European officials will agree a plan to recapitalize the region’s banks sparked advances commodity-price sensitive currencies. Elevated oil prices helped lift the Canadian dollar which gained almost 200 pips against the greenback as USDCAD fell to 1.0132.
The Australian dollar rose against the US dollar, rising to its highest level since September 21 as higher yielding assets were boosted today. AUDUSD peaked at 1.0205 gaining 345 pips on the day.
USDJPY surged to a four-week high, hitting 77.47 in the New York session, finally breaking the tight range it has been in for a month. EURJPY also rose to its highest since September 9, hitting 107.04 in the US session, climbing from 104.19 in Asian trading today.