2010.07.2003:48:00UTC+00Euro Jumps To Fresh Multi-month High Against Dollar

Tuesday, the euro advanced to a new multi-month high against the dollar, 4-day high against the yen and a 4-week high against the franc shortly after the release of the German PPI report at 2:00 am ET, which showed that the producer price inflation increased further in June.

The producer price index, or PPI, rose 1.7% year-on-year in June, faster than a 0.9% growth in the previous month, a report by the Federal Statistical Office showed. Producer prices increased for the third consecutive month. Economists were looking for an increase of 1.1%.

On a monthly basis, the PPI rose 0.6% in June, faster than a 0.3% growth in the previous month. The monthly producer price inflation rose for fifth straight month. Economists had expected an increase of 0.2%.

At 2:20 am ET Tuesday, the euro soared a fresh multi-month high of 1.3029 against the dollar, breaching last Friday's high of 1.3008. If the euro advances further, it may likely target the 1.310 level. The euro-dollar pair that closed yesterday's trading at 1.2942 is currently worth 1.3015.

At the same time, the euro strengthened to a 4-week high of 1.3679 against the Swiss franc and a 4-day high of 113.37 against the yen. The next upside target level for the euro is seen at 114.2 against the yen and 1.404 against the franc. As of now, the euro is worth 113.24 against the yen and 1.3670 against the franc, compared to yesterday's close of 112.20 and 1.3656, respectively.

The Swiss trade balance report for June released at 2:15 am ET also likely influenced the euro-franc pair.

Looking ahead, the Italian industrial orders for May, U.K. M4 money supply and the public finances data for June are expected in the upcoming hours.

The U.S. housing starts and building permits report for June has been slated for release in the New York morning.

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