The dollar posted the biggest weekly gain versus the euro in more than two months on optimism the worst of the financial crisis in the U.S. is over.
The Dollar Index, which tracks the greenback against the currencies of six of its biggest trading partners, completed the largest weekly advance since November after Wells Fargo & Co.’s profit beat estimates, triggering the steepest one-day gain on record in the Standard & Poor’s 500 Banks Index. The euro dropped the most against the yen since January on concern the European Central Bank will cut its benchmark interest rate to below 1 percent to spur growth.
“Wells Fargo’s results augur well for U.S. banks’ earnings and point to an easing in the financial crisis,” said Masanobu Ishikawa, general manager of foreign exchange at Tokyo Forex & Ueda Harlow Ltd., Japan’s largest currency broker. “The dollar is likely to be bought.”
The dollar climbed 2.3 percent this week to $1.3143 per euro on April 10, the biggest gain since the five days through Jan. 23. It touched $1.3090 yesterday, the strongest level since March 18. The greenback strengthened 1.1 percent to $1.4672 per pound and advanced 0.6 percent to 1,333 South Korean won.
From Bloomberg News