Euro Gains Versus Dollar as Stocks, Commodities Pare Losses; Franc Rises

The euro rose versus the dollar as stocks and commodities pared losses and inflation in the 17- nation currency bloc gained to the fastest since 2008, boosting pressure on the European Central Bank to raise interest rates.

The Swiss franc rose against most major currencies as investors sought safety as finance ministers at a meeting in Brussels struggled to resolve the euro region’s debt crisis. New Zealand’s dollar was among the worst performers against its U.S. counterpart.

“Traders in the New York session are deciding euro- weakness is overdone,” said Camilla Sutton, head of currency strategy at Bank of Nova Scotia in Toronto. “The euro-zone inflation is supportive of further ECB interest rate hikes.”

Europe’s shared currency rose 0.5 percent to $1.4194 at 1:04 p.m. in New York, from $1.4119 on May 13. It earlier dropped to $1.4048, the weakest level since March 29. The euro gained 0.5 percent to 114.61 yen, from 114.06. The U.S. currency was little changed at 80.76 yen.

The franc appreciated 0.6 percent against the euro to 1.2532, and climbed 1.1 percent to 88.29 centimes per dollar. It earlier depreciated 0.3 percent to 89.51 centimes, the weakest since April 20.

The euro dropped 0.7 percent over the past month in a measure of the currencies of 10 developed nations, the Bloomberg Correlation-Weighted Currency Indexes, as yields for the region’s most-indebted nations jumped amid heightened concern they may struggle to repay their debt. The yen gained 4.3 percent, while the dollar appreciated 1 percent.