* Dollar index hits 10-day high
* Euro falls to 15-day low
* Treasury yield spike, technical trading prompt euro
(Recasts throughout; updates to afternoon U.S. trading)
By Dion Rabouin
NEW YORK, March 30 The dollar rose on Thursday
as a combination of technical trading and a theme of strong U.S.
economic data and potential weakness in the euro zone weighed
down the continental currency.
Analysts said the euro falling below a technically important
level around $1.07 against the dollar triggered orders by
traders to sell, pushing the currency lower against the
greenback. That helped sink it to $1.0686, its lowest since
That move added to the dollar's gains against a basket of
major currencies, which was trading modestly higher
before the euro's selloff. The index rose to a 10-day high of
It was the combination of selling at around $1.07, U.S.
Treasury bond yields hitting session highs and higher crude
prices boosting oil-linked currencies that cracked the
resistance level in the euro, said Thierry Albert Wizman, global
interest rates and currencies strategist at Macquarie Limited,
citing information from his trading desk.
The euro had already been trading lower thanks to
data released earlier in the day that showed German and Spanish
consumer inflation slowed more sharply than expected in March,
prompting worries that sluggish growth in the euro zone could
In the United States, gross domestic product grew faster
than previously reported in the fourth quarter of last year
thanks to robust consumer spending, the Commerce Department
Those bits of fundamental data had investors ready to buy
the dollar and sell the euro, and the break in the euro's price
gave them a reason to do so, analysts said.
"Most of the market thought that the dollar had gotten too
undervalued after last week and were just waiting for it to
bounce," said Greg Anderson, global head of foreign exchange
strategy at BMO Capital Markets. "Once it was clear that it
bounced they were going to jump in and buy it or (sell the
(Reporting by Dion Rabouin; Editing by David Gregorio and Chizu