LONDON—The euro rose Tuesday, driven by speculation over a European Union Council summit Thursday.
The euro was up at $1.3725 from $1.3659 and at 123.15 yen from 121.97 yen. The dollar managed to rise to 89.72 yen from 89.30 yen late Monday, according to EBS.
The dollar was also down at 1.0691 Swiss franc from 1.0722 franc, while the pound was lower at $1.5572 from $1.5598 after the British Retail Consortium reported that retail sales fell 0.7% last month, the worst January decline in 15 years.
The move was triggered by a report that European Central Bank President Jean Claude Trichet would be leaving a central bankers meeting in Sydney to head for Brussels to attend the summit.
Although the meeting of EU.leaders was organized some time ago, there is widespread speculation that the primary focus will be on resolving the region's debt problems.
These developments helped to encourage some profit-taking in the euro, where net short positions have been driven to recent highs.
But some analysts reckon that investors will probably turn quiet again ahead of the summit.
The currency team at Commerzbank AG reckoned that any positive news on Greece's debt problems probably won't be significant enough to prompt any more short-covering, while Greece-negative news won't have any impact as investors are already positioned in that direction.
All the same, the recent sharp rise in the cost of credit-default swaps, a type of default insurance, in Greece, Portugal and Spain came to an end with prices either stabilizing or receding slightly Tuesday.
Hopes that the summit will come up with some resolution to Greece's debt problems were enough to support stocks. The Shanghai Composite Index closed 0.5% higher and then European markets opened as much as 0.5% higher.
