Euro extends end-of-year rally against dollar

The euro continued its end-of-year climb in European currency trading this Tuesday, approaching $1.2250 and flirting with its two-and-a-half year high. 

The common currency was trading at $1.2244 at 15.00 GMT, compared to $1.2215 at the same time on Monday. The European Central Bank (ECB) set the reference exchange rate for the day at USD 1.2259. 

The intraday high was $1.2275, reached in the early hours of Tuesday afternoon, slightly above the $1.2268 reached on December 17, the high for the common currency since the second quarter of 2018. 

On a day with little turnover and no major economic incentives, the euro continued to benefit from the optimism generated by the trade agreement reached between the European Union (EU) and the United Kingdom and by the start of the vaccination campaign against COVID in the 27 countries. 

The euro has appreciated by 1.73% against the dollar in the last month, but by more than 8% in the last half year and by almost 9% since last January, when the coronavirus pandemic was beginning to take hold. 

The common currency fluctuated widely during the day, between $1.2208 and $1.2275.