Euro climbs from lowest in three weeks amid optimism on Europe

Six Months

The euro lost 3.5 percent over the past six months, the biggest drop after the Swiss franc among the 10 developed-nation currencies tracked by Bloomberg Correlation Weighted Indexes. The dollar was little changed, and the yen jumped 7 percent.

The pound depreciated against 13 of its 16 most-traded counterparts as a gauge of factory output, based on a survey by Markit Economics and the Chartered Institute of Purchasing and Supply, fell to 48.4 last month from a revised 49.6 in August. The median forecast of 29 economists in a Bloomberg News survey called for a reading of 49.

Sterling fell 0.5 percent to 80 pence per euro, the least in a week. It was little changed at $1.6156 after touching $1.6109 earlier, the weakest since Sept. 13.

Sweden’s krona is the best performer in a basket of developed-market peers since June, with a 3 percent advance, almost twice that of the second-place Norwegian krone.

Strategists raised their estimates for the currency against the dollar by about 8 percent in less than three months as the central bank last month signaled that it sees no need to curb the krona’s advance. That’s in contrast to the dollar, which fell last quarter as Fed Chairman Ben S. Bernanke’s open-ended stimulus plan debased the currency, and the euro, which weakened amid a third year of debt turmoil.

‘Wind Behind’

Sweden’s krona was little changed today at 6.5607 per dollar, after advancing 5.2 percent against the U.S. currency in the third quarter. It slipped 0.4 percent to 8.4755 per euro.

“The krona can go a lot further,” John Taylor, the founder and chief executive officer of New York-based hedge fund FX Concepts LLC, which manages $3 billion, said in a Sept. 27 interview. “Sweden has the wind behind it because Bernanke is making the dollar go down and Europe keeps having these traumas.”

The Dollar Index, which IntercontinentalExchange Inc. uses to track the greenback against the currencies of six U.S. trading partners, slid 0.4 percent to 79.632 after climbing earlier to 80.147, the highest since Sept. 11.

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