June 7, 2018 / 2:59 PM / 9 months ago

FOREX-Euro climbs to 3-week high on bets ECB to signal stimulus end

    * ECB officials say to debate QE end next week
    * Some analysts say stimulus decision to come in July, not
    * Mood cautious ahead of G7 meeting
    * Graphic: World FX rates in 2018 tmsnrt.rs/2egbfVh

 (Adds comment, FX table, updates prices in text, changes 
dateline; previous LONDON)
    By Gertrude Chavez-Dreyfuss
    NEW YORK, June 7 (Reuters) - The euro scaled three-week
peaks against the dollar on Thursday  as investors boosted their
bets that the European Central Bank at next week's monetary
policy meeting will flag the winding down of its vast
bond-buying program by the end of this year.
    The single European currency has risen for four straight
sessions. Since hitting a 10-month low last week, it has gained
nearly 3 percent.
    The ECB's chief economist, Peter Praet, a close ally of
President Mario Draghi, said on Wednesday the central bank at
its policy meeting next week would debate whether to end bond
purchases later this year.
    Other ECB officials echoed Praet's sentiment.
    Jens Weidmann, the head of Germany's central bank, said on
Wednesday expectations the ECB would taper its bond-buying
program by the end of this year were plausible. Weidmann's Dutch
counterpart, Klaas Knot, said there was no reason to continue a
quantitative easing program.
    The comments drove the euro on Thursday to $1.1840,
the highest since May 17. It was last up 0.4 percent at $1.1817.
    "Any signal next week that the bank plans to go ahead with
winding down its asset purchases in the fall could add to the
euro’s broadly improved tone," said Omer Esiner, chief market
analyst, at Commonwealth Foreign Exchange in Washington.
    Some analysts have taken the comments from ECB officials
this week as suggesting a decision on the stimulus is coming at
the June 14 meeting. Others, however, saw them as the starting
point in a debate that will likely culminate in an announcement
in July.
    "Just because the discussion is starting in June does not
mean that it's necessarily going to be completed at this
meeting," TD Securities said in a research note.
    "Last year... we saw the ECB begin to discuss its QE
extension plans at the September meeting, while it didn't
actually announce those results until October."
    The euro's gains have pushed the dollar index, a measure
that is heavily weighted toward Europe's single currency, to a
three-week low as well. The dollar index was last down
0.3 percent at 93.36.
    Many, however, remain cautious ahead of a summit this
weekend of the Group of Seven leaders, where U.S. President
Donald Trump looks set to clash with his counterparts over
    "The trade stance of the U.S. administration worries
economists because it could hurt business confidence that drives
 waves of investment and spending," said Juan Perez, senior
currency trader at Tempus Consulting in Washington.
    Currency bid prices at 10:38AM (1438 GMT)
 Description      RIC         Last           U.S. Close  Pct Change     YTD Pct     High Bid    Low Bid
                                              Previous                   Change                 
 Euro/Dollar      EUR=        $1.1814        $1.1773     +0.35%         -1.52%      +1.1840     +1.1773
 Dollar/Yen       JPY=        109.8900       110.1600    -0.25%         -2.47%      +110.2100   +109.8500
 Euro/Yen         EURJPY=     129.85         129.71      +0.11%         -3.94%      +130.2700   +129.5400
 Dollar/Swiss     CHF=        0.9810         0.9861      -0.52%         +0.69%      +0.9868     +0.9806
 Sterling/Dollar  GBP=        1.3390         1.3411      -0.16%         -0.91%      +1.3471     +1.3373
 Dollar/Canadian  CAD=        1.2979         1.2942      +0.29%         +3.20%      +1.2990     +1.2935
 Australian/Doll  AUD=        0.7634         0.7666      -0.42%         -2.14%      +0.7673     +0.7635
 Euro/Swiss       EURCHF=     1.1591         1.1612      -0.18%         -0.84%      +1.1635     +1.1588
 Euro/Sterling    EURGBP=     0.8821         0.8776      +0.51%         -0.69%      +0.8837     +0.8776
 NZ               NZD=        0.7039         0.7030      +0.13%         -0.66%      +0.7056     +0.7033
 Dollar/Norway    NOK=        8.0436         8.0785      -0.43%         -2.00%      +8.0805     +8.0237
 Euro/Norway      EURNOK=     9.5037         9.5133      -0.10%         -3.50%      +9.5189     +9.4912
 Dollar/Sweden    SEK=        8.6775         8.7321      -0.27%         +5.80%      +8.7334     +8.6549
 Euro/Sweden      EURSEK=     10.2527        10.2805     -0.27%         +4.22%      +10.2870    +10.2359
 (Reporting by Gertrude Chavez-Dreyfuss; Additional reporting by
Richard Leong in New York and Tommy Wilkes in London; Editing by
Dan Grebler)
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