The greenback received a boost following the release of better than anticipated economic reports showing that growth didn’t slow as much as expected during the second quarter, thereby reducing the possibility the Federal Reserve will implement further easing this week. According to the U.S. Commerce Department, Gross Domestic Product, which reflects the value of goods and services produced in the U.S., increased at a 1.5% annual rate.
The Euro continued to rally against the U.S. Dollar as currency market investors remain hopeful the European Central Bank will do whatever it takes to stem the ongoing debt crisis. The shared currency also benefitted from comments made by France’s new President, Francois Hollande, and German Chancellor Angela Merkel who indicated that they were both “bound by duty” to protect the bloc’s currency. Optimism endured as a report in European newspaper Le Monde revealed that E.U. leaders were working on a plan to help Italy and Spain.
The Yen declined across the board as appetite for risk increased subsequent to positive words issued by the President of the ECB on Thursday. The fact that regional leaders and officials are devising a solution aimed at helping Spain and Italy also impacted negatively on the Yen.
Other FX trade news showed that the Canadian Dollar traded at a 10-week high versus the greenback following a hike in stocks and crude oil. The Loonie came close to parity with its American counterpart after a release out of the U.S. confirmed that the economy expanded at a slow pace, though not as slow as previously forecast.