Forex: Weekly’s review

On Monday the yen rallied versus all of its most-traded counterparts after China said it will lower its target for economic growth, boosting demand for the relative safety of Japan’s currency. China pared the nation’s economic growth target from an 8 percent goal in place since 2005, a signal that leaders are determined to cut reliance on exports and capital spending in favor of consumption. The euro gained against most major currencies as Greece said it expected private creditors to accept its debt-swap terms because it constitutes “the best offer.” The euro rose against the dollar after European retail sales unexpectedly increased in January after four months of declines as growth in France helped to outweigh a drop in Germany.

On Tuesday the euro declined to a two-week low versus the dollar after a report showed the region’s economy contracted last quarter, adding to signs the European debt crisis is hampering global growth. Europe’s gross domestic product shrank 0.3 percent from the third quarter, the region’s statistics office said, confirming an initial estimate published on Feb. 15. Exports fell 0.4 percent and household spending declined 0.4 percent. The yen rose against all its major counterparts and gained for a fifth day against the 17-nation currency as 20 percent of Greece’s private creditors have agreed to debt restructuring.

On Wednesday the euro rallied from a two-week low against the dollar as investors with 58 percent of the Greek bonds eligible have indicated they’ll participate in the so- called private-sector involvement of the nation’s bailout. The nation has said it will use collective action clauses to force holders of Greek-law bonds to accept the swap if it receives sufficient consent from investors.

The dollar rose against the yen after a report that the Federal Reserve is considering sterilized bond purchases. Brazil’s real tumbled against all of its most-traded counterparts as the government prepared measures to control capital inflows and stem the currency’s appreciation.

On Thursday the euro strengthened  on speculation Greece will attract enough investors to make its debt-swap plan a success, adding to optimism the region’s debt crisis will be contained. The common currency rose for a second day versus the dollar after the European Central Bank kept its benchmark interest rate unchanged and President Mario Draghi said recent surveys showed signs of economic stabilization. The dollar had gained against most major currencies in the period as investors sought safety on concern the Greek debt swap might unravel. Greece’s largest banks, most of the country’s pension funds, and more than 30 European banks and insurers including BNP Paribas SA, Commerzbank AG (CBK) and Assicurazioni Generali SpA (G) have agreed to the offer.

On Friday the dollar rose to a 10-month high versus the yen as a report showed U.S. job growth during the past six months was the strongest since 2006, dimming prospects for further Federal Reserve monetary stimulus. U.S. nonfarm payrolls increased by 227,000 in February after rising by a revised 284,000 the prior month, data from the Labor Department showed today. The unemployment rate held at a three-year low of 8.3 percent. Fed Chairman Ben S. Bernanke’s comments in congressional testimony last week damped speculation the central bank will introduce another round of asset purchases.

The 17-nation euro weakened for the first time in three days against the dollar after Greece said it triggered an option compelling investors to take part in its debt restructuring.