Euro rises as fears about Spain ease

AP News
Posted: May 10, 2012 4:02 PM
Euro rises as fears about Spain ease

The euro rose against the dollar Thursday for the first time in 10 days as fears about Spain's banking system eased.

Spanish stocks rallied Thursday after the government said it will nationalize the country's fourth-largest bank. Traders have become concerned that the country may need a financial bailout. Spain, the euro zone's fourth-largest economy, is in a recession and has an unemployment rate of 24.4 percent.

Spain is expected to announce a banking system overhaul Friday to get banks to start lending.

In another sign that investors are less concerned about the country's finances, Spain's 10-year borrowing rate fell below 6 percent after rising above that level Wednesday.

The euro rose to $1.2951 in late trading Thursday from $1.2945 late Wednesday. The euro fell 1.24 percent against the dollar this week after elections Sunday in Greece left the country in political turmoil. A separate election in France elected a new president in Sunday.

In other trading, the British pound rose to $1.6153 from $1.6142. The dollar rose to 79.91 Japanese yen from 79.68 yen

The dollar fell to 0.9274 Swiss franc from 0.9277 Swiss franc. The U.S. currency was practically unchanged at 1.0011 Canadian dollar from 1.0012 Canadian dollar.