Friday July 24, 11:48 AM
Euro boosted by German data
LONDON (AFP) - The European single currency advanced Friday against the dollar after news of strengthening business confidence in Germany, Europe's biggest economy.
In late morning trading here, the euro rose to 1.4216 dollars from 1.4156 dollars in New York late on Thursday.
The dollar fell to 94.92 yen from 94.95 yen reached late Thursday.
The mood among German firms brightened for the fourth month running in July amid signs that the worst may be over for Europe's biggest economy, the closely watched Ifo index showed on Friday.
The Ifo institute's business climate index for July rose to 87.3 points, beating market expectations of 86.5 points and up from 85.9 points in June. It was the highest reading since November 2008.
At the same time, a key measure of buying managers' activity in the eurozone firmed in July for the fifth month running to the highest level for 10 months, a survey showed on Friday.
"The recession in the eurozone is obviously coming to an end," said Commerzbank (Xetra: 803200 - news) analyst Ralph Solveen.
"Sentiment indicators climbed again in July... and the purchasing managers' indices for the eurozone are gradually approaching the contraction/expansion threshold.
"All of this points to an economic recovery in the second half of this year."
The index of purchasing managers' activity in the manufacturing and services sectors by the Markit survey company put the index at 46.8 points from 44.6 in June, on the basis of a first estimate.
This was the highest reading since September 2008 when it stood at 46.9 points.
But the survey continues to reflect underlying weakness in these sectors because only a reading above 50 points signals expansion. The index has been below 50 for 14 months in a row.
Elsewhere, the pound fell against the dollar after news that the British economy shrank in the second quarter at its fastest year-on-year pace since records began in 1955, amid the worst recession since the early 1980s.
Gross domestic product contracted by 5.6 percent in the three months to the end of June, compared with the same period of last year.
The economy also shrank 0.8 percent during the second quarter compared with the first three months of the year. That marked the fifth quarterly contraction in a row.
In London trading on Friday, the euro was changing hands at 1.4216 dollars against 1.4156 dollars late on Thursday, 134.82 yen (134.40), 0.8633 pounds (0.8585) and 1.5229 Swiss francs (1.5209).
The dollar stood at 94.92 yen (94.95) and 1.0722 Swiss francs (1.0744).
The pound was at 1.6450 dollars (1.6485).
On the London Bullion Market, the price of gold rose to 951.33 dollars an ounce from 950 dollars an ounce late on Thursday.
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