The euro surged 3.4 cents against the dollar to above $1.42 before settling at 2100 GMT at $1.4187, compared to $1.3908 a day earlier.

It was the European currency's best level in eight weeks, since concerns over the political ability of European Union leaders to contain the Greek debt crisis left a dark cloud over the markets.

The euro rose to 107.73 yen from 105.98 yen late Wednesday, while the dollar fell to 75.94 yen (76.21 yen).

"Higher-yielding currencies like the Australian dollar benefited the most from the broad rally in risky assets, soaring some two percent against the greenback to seven-week highs," said analysts at Travelex.

"The yen stuck close to record highs on the dollar despite a move by Japan's central bank to further ease monetary policy."

Some however remained wary before the details of the complex pact -- and the follow-through by eurozone governments expected to implement difficult austerity programs -- are known.

"There are still lots of loose ends that need tying up and once they are there's still no guarantee that this will have resolved the crisis altogether," said forex specialist Simon Denham at Capital Spreads.

The dollar also dropped to 0.8599 Swiss francs (0.8808 francs Wednesday), while the British pound rose to $1.6095 (1.5973).

China's thinly-traded yuan was little changed at 6.36 to the dollar, despite news that Beijing might contribute a significant amount to strengthening the EU emergency rescue fund as part of Thursday's deal.