Euro strengthens after stellar quarterly results

The euro strengthened by 1.42 cents (1.02%) against the US dollar yesterday to close the day at $1.4107.

• Stellar quarterly results from investment bank Goldman Sachs and Intel, the chipmaker, buoyed risk appetite in the market yesterday as “haven” demand for the greenback subsided.
  
• This news also spurred global equity markets, with the Dow Jones eventually finishing the day up over 3% yesterday.
  
• Elsewhere, news that China’s foreign exchange reserves, the world’s largest, had grown by a record $178.3 billion to $2,130 billion in the second quarter also undermined the dollar.
  
• Finally, the announcement that US core CPI had risen to 0.2% in July, as expected, from 0.1% last month also aided the single currency’s gains yesterday as the prospect of deflation now looks increasingly unlikely.
  
• There are no major announcements due in the eurozone today, whilst in the US TIC Long-Term Purchases data is out at 14.00 BST.