Key facts
- The euro rose 0.16% to $1.1268, a fourth straight session of gains.
- The dollar index fell 0.10% to 101.38 after touching 101.21, its lowest since September 30.
- Deutsche Bank's George Saravelos said political developments were supportive of a bottoming out in euro/dollar.
- Sterling rose 0.05% to $1.3478, a seventh straight daily rise, ahead of a Bank of England announcement.
The euro rose for a fourth straight session on November 5, reaching $1.1268, up 0.16%, after hitting $1.1273 on November 4, its highest level since October 6, according to a report by CNA. The dollar index, which measures the greenback against a basket of currencies, fell 0.10% to 101.38, after touching 101.21 in the Asian session, the lowest since September 30.
The report attributed the move to lower energy prices and hopes that the risk of escalation in the Iran conflict could ease after Republicans lost control of Congress in the midterm elections. A resolution of the conflict could restore Middle East oil flows disrupted by the war, the report said. Citi said concerns that the White House could escalate tensions with Iran persisted after the midterm vote.
George Saravelos, global head of forex strategy at Deutsche Bank, said: "On balance, we see political developments overnight as supportive of a continued bottoming out in the euro/dollar." The report said analysts cautioned the euro could face renewed pressure as investors temper expectations for further European Central Bank monetary tightening and as concerns linger over France's fiscal trajectory.
Sterling strengthened 0.05% to $1.3478, poised for its seventh straight daily rise, ahead of the Bank of England's policy announcement on Thursday. The yen rose 0.14% to 158.18 per dollar after minutes from the Bank of Japan's September meeting reinforced bets for further rate hikes. Markets are pricing in an 80.7% chance of a Fed rate increase of at least 25 basis points in December, according to CME FedWatch, up from 77.4% in the prior session.