American focus:

The euro rose versus all of its major counterparts as traders speculated that European Union leaders will step up efforts to contain the region’s debt crisis and demand rose at Spain’s debt sale.
Spain sold 3 billion euros ($3.9 billion) of five-year bonds in its first debt auction of the year, meeting its maximum target. Demand was 2.1 times the amount sold, compared with 1.6 times at the previous sale. Italy sold 6 billion euros of bonds due in 2015 and 2026.
The 17-nation currency had its biggest four-day gain versus the dollar since September as European Central Bank President Jean-Claude Trichet signaled an increased risk of inflation.
Trichet signaled he’s prepared to raise interest rates if needed to fight inflation even as leaders struggle to contain the region’s sovereign debt crisis.
The dollar dropped versus the yen as U.S. jobless claims rose to the highest level since October.
U.S. initial jobless claims rose in the first week of 2011 to 445,000, the highest level since October, the Labor Department reported. Separate reports showed the producer price index rose last month by the most in 11 months, while the trade deficit unexpectedly narrowed in November.
“The claims only reminded traders of the difficult road ahead,” said Kathy Lien, director of currency research at the online currency trader GFT Forex in New York. “The PPI and trade balance numbers should be bullish for the dollar, but that was offset by the shockingly high level of jobless claims.”