The euro scaled three-week peaks against the dollar on Thursday as investors boosted their bets that the European Central Bank at next week's monetary policy meeting will flag the winding down of its vast bond-buying program by the end of this year.
The single European currency has risen for four straight sessions. Since hitting a 10-month low last week, it has gained nearly 3 percent. The ECB's chief economist, Peter Praet, a close ally of President Mario Draghi, said on Wednesday the central bank at its policy meeting next week would debate whether to end bond purchases later this year.
Other ECB officials echoed Praet's sentiment. Jens Weidmann, the head of Germany's central bank, said on Wednesday expectations the ECB would taper its bond-buying program by the end of this year were plausible. Weidmann's Dutch counterpart, Klaas Knot, said there was no reason to continue a quantitative easing program.
The comments drove the euro on Thursday to $1.1840, the highest since May 17. It was last up 0.4 percent at $1.1817.
"Any signal next week that the bank plans to go ahead with winding down its asset purchases in the fall could add to the euro's broadly improved tone," said Omer Esiner, chief market analyst, at Commonwealth Foreign Exchange in Washington.
Some analysts have taken the comments from ECB officials this week as suggesting a decision on the stimulus is coming at the June 14 meeting. Others, however, saw them as the starting point in a debate that will likely culminate in an announcement in July.
"Just because the discussion is starting in June does not mean that it's necessarily going to be completed at this meeting," TD Securities said in a research note.
The euro's gains have pushed the dollar index, a measure that is heavily weighted toward Europe's single currency, to a three-week low as well. The dollar index was last down 0.3 percent at 93.36.
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