April 1 (Bloomberg) -- The euro strengthened for a third day against the dollar after a German report showed unemployment fell more than economists forecast, adding to signs the region’s recovery is gathering momentum.
The common currency climbed to a two-week high versus the yen as a measure of Spanish manufacturing also increased, damping speculation the European Central Bank will boost stimulus. Sweden’s krona rallied for a second day after the nation’s factory output unexpectedly accelerated. South Africa’s rand fell after manufacturing growth slowed more in March than economists predicted. South Korea’s won climbed to the strongest in six weeks as exports increased.
“We don’t feel the ECB will be forced to do more right now,” said Roberto Mialich, a senior currency strategist at UniCredit Bank AG in Milan. “We will continue to see a stronger euro in the medium term.”
The euro rose 0.2 percent to $1.3799 at 7:07 a.m. in New York, after gaining 0.2 percent during the previous two days. The shared currency appreciated 0.4 percent to 142.65 yen after climbing to 142.68 yen, the highest level since March 13. The dollar strengthened 0.1 percent to 103.37 yen.
The number of people out of work in Germany dropped by a seasonally adjusted 12,000 in March to 2.9 million, after falling a revised 15,000 the previous month, the Federal Labor Agency said. Economists forecast a decline of 10,000, according to a Bloomberg survey. A gauge of Spanish factory output increased to 52.8 from 52.3, Markit Economics said, citing a survey of purchasing managers. Readings above 50 show growth.
The euro has rallied 7.9 percent in the past 12 months, the best performer after the pound among 10 developed-nation currencies tracked by Bloomberg Correlation-Weighted Indexes. The dollar dropped 0.4 percent and the yen tumbled 11 percent.
Policy makers in Frankfurt will keep the benchmark interest rate at a record-low 0.25 percent on Thursday, according to all but three of 57 economists in a Bloomberg News survey. One forecaster predicted a cut to 0.1 percent while two called for 0.15 percent.
The krona rose versus all except two of its 16 major counterparts after Stockholm-based Swedbank AB said its index of Swedish factory output increased to a seasonally adjusted 56.5 last month from 54.6 in February.
The Swedish currency climbed 0.1 percent to 8.9035 per euro and appreciated 0.3 percent to 6.4531 versus the dollar.
The rand snapped a six-day advance after South Africa’s Kagiso Tiso Holdings said its measure of the nation’s factory output fell to 50.3 from 51.7 in February. The median prediction in a Bloomberg survey was 51.2.
The South African currency weakened 0.5 percent to 10.5836 per dollar after appreciating 3.4 percent in the prior six days.
South Korea’s won appreciated for a fifth day, gaining 0.6 percent to 1,058.70 per dollar at the close in Seoul, the strongest level since Feb. 17.
Overseas sales for the Asian nation climbed 5.2 percent in March from a year earlier, beating the 4.2 percent gain projected in a Bloomberg survey.
Australia’s dollar reached a four-month high after the Reserve Bank held interest rates at a record-low 2.5 percent. It reversed gains after Governor Glenn Stevens said the currency’s recent climb will reduce the stimulus provided to the economy.
The Aussie gained as much as 0.4 percent to 93.04 U.S. cents, the strongest since Nov. 21, before weakening 0.3 percent to 92.39.