Upbeat ECB forecast lifts euro

2012-05-04 08:33

Singapore - The euro edged up against the dollar in Asia on Friday as traders took heart from European Central Bank forecasts that the eurozone would recover in the second half of this year, analysts said.

In midday Asian trade, the euro edged up to $1.3150 from $1.3149 in New York late on Thursday. The single currency was unchanged against the Japanese currency at ¥105.45.

The greenback traded at ¥80.19 from ¥80.20.

Japanese financial markets are closed on Friday for a public holiday.

ECB president Mario Draghi's prediction on Thursday that the troubled eurozone economy would recover in the last six months of 2012 sparked a run for the euro, said Justin Harper, market strategist for IG Markets Singapore.

"He's far more bullish... any sort of positive news especially from the ECB president, that's given the euro a bit of a lift against the greenback today," Harper told AFP.

Draghi made the forecast at an ECB policy meeting in Barcelona, where the bank also pledged to maintain its key interest rate at a historic low of 1.0% for the sixth month in a row.

The euro's rise against the greenback could be improved later Friday with the release of a US jobs report, DBS Group Research said in a report.

"There is a lot of nervousness surrounding tonight's US non-farm payrolls data given the slew of disappointing data, not just in the US, but also in many parts of the world," the report stated.

Economists expect Friday's jobs report to show the world's largest economy created a meagre 162 000 jobs last month, while the unemployment rate remains stuck at 8.2%.

The greenback was up against other Asian currencies, trading at 1,131.52 South Korean won from 1,129.47 won on Thursday, at 42.26 Philippine pesos from 42.23, and Sg$1.2420 from Sg$1.2411.

It was also at 30.95 Thai baht from 30.91 baht, 9,230.00 Indonesian rupiah from 9,197.00 rupiah and Tw$29.23 from Tw$29.21.