The euro rallied to a 2-1/2 month high versus the US dollar on Tuesday after solid manufacturing data Worldwide though analysts said risk appetite could fade given concern over the euro zone's debt problems. The euro briefly climbed above $1.38 after taking out resistance at $1.3786, its November 22 high.
Support is seen in the $1.3750 area and a close above would open the way to a run toward $1.40, a level that likely will attract selling interest. The US dollar came under broad pressure as safe-haven demand fell. It slipped to a four-week low of 81.42 yen on EBS, while an index of the US dollar against a basket of other currencies fell as low as 77.092, its weakest since early November.
The Australian dollar soared 1.7 percent on the day to a four-week high of $1.0138 after the country's central bank ended its monthly policy meeting with a generally upbeat assessment of the domestic and global economy. Sterling jumped to a 2-1/2-month high of $1.6156 after UK manufacturing PMI hit a record high in January, boosting expectations for a UK rate rise by mid-year. It was last up 0.7 percent at $1.6131.
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