Euro hits 7-month high vs dollar on budget hopes

Euro hits 7-month high vs dollar on hopes US lawmakers will reach budget deal

Associated Press

NEW YORK (AP) -- Hopes that U.S. lawmakers are closer to a budget deal pushed the euro to a seven-month high against the dollar Tuesday.

Risker currencies, such as the euro, tend to rise when traders think economic risks are receding.

The euro rose to $1.3220 late Tuesday from $1.3160 late Monday. The euro rose as high as $1.3238 earlier, its highest point against the dollar since May 2.

Traders have been worried about the U.S. "fiscal cliff," a series of tax increases and government spending cuts set to kick in at the beginning of next year unless the White House and Congress reach an agreement on reducing the budget deficit.

On Tuesday, House Speaker John Boehner says he's hopeful a deal can be reached.

In other trading, the British pound rose to $1.6248 from $1.6203.

The dollar fell to 0.9136 Swiss franc from 0.9179 Swiss franc.

The dollar rose to 84.20 Japanese yen from 83.83 Japanese yen and to 98.54 Canadian cents from 98.42 Canadian cents.

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