TRADERS increased bets that the Federal Reserve will raise interest rates by July following minutes of the Fed’s July meeting and brightening US fundamentals helped power the US dollar to fresh 11-month peaks against a wide swath of rivals, including the euro.
Further signs of an improving US economy stood in contrast to fresh signs of weakness abroad in places like Europe, United Kingdom and New Zealand. The euro hit new November 2013 lows against the greenback after a key pillar for the bloc, its current account surplus, shrank in stature in the latest period. The bloc’s current account narrowed more than expected to 13.1 billion euros in June from an upwardly revised 19.8 billion euros in May. Poor sentiment remained toward the currency and it could quickly find itself on the receiving end of a short-covering rally given that bets against the euro have become the most stretched in years.
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