Bloomberg News

Euro Pares Advance on Concern Crisis Solution Will Elude Summit

October 20, 2011

Oct. 20 (Bloomberg) -- The euro pared its gain against the dollar on concern European leaders will struggle to agree on a solution to the region’s debt crisis at a summit this weekend.

The 17-nation currency rose earlier today after European Commission President Jose Barroso said a “positive outcome” was possible at an Oct. 23 meeting of European leaders in Brussels. Draft guidelines showed planned changes to the euro region’s bailout fund may allow increased credit lines for countries such as Italy and Spain.

“The uncertainty in Europe remains very high, and expectations are all over the map,” said Michael Woolfolk, senior currency strategist in New York at Bank of New York Mellon Corp., the world’s largest custodial bank, with more than $26 trillion in assets under administration. “It’s quite remarkable the euro is able to maintain its current level.”

The euro was little changed at $1.3774 at 8:45 a.m. New York time, after advancing 0.6 percent. The European currency gained 0.4 percent to 106.08 yen. The dollar appreciated 0.3 percent to 77.04 yen after falling 0.2 percent.

--With assistance from Lucy Meakin in London and Candice Zachariahs in Sydney. Editors: Dennis Fitzgerald

To contact the reporters on this story: Catarina Saraiva in New York at asaraiva5@bloomberg.net; Emma Charlton in London at echarlton1@bloomberg.net

To contact the editor responsible for this story: Dave Liedtka at dliedtka@bloomberg.net


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