Euro down as Juncker says euro gains unwanted

By Steven C. Johnson

NEW YORK (Reuters) - The euro pulled back from a record high against the dollar in choppy trade on Thursday after a top euro zone official said recent appreciation in the single currency was undesirable.

The euro was last trading at $1.5910, down 0.2 percent from Wednesday. It had soared to a record just shy of $1.60 before retreating when Eurogroup head Jean-Claude Juncker complained about euro strength against the dollar.

He also said markets misunderstood a statement last weekend by the Group of Seven rich countries that voiced concern over sharp fluctuations in major currencies.

"The market is chasing its tail today, trying to take out $1.60 overnight before Juncker's comments took everyone by surprise and wiped out some euro longs," said Steven Butler, head of FX trading at Scotia Capital in Toronto. "Then people got caught the other way and pushed the euro above $1.59."

Elsewhere, the dollar was up 0.4 percent at 102.22 yen and 0.3 percent at 1.0030 Swiss francs.

Juncker's remarks initially fed concern that G7 officials may intervene directly in the currency market and buy dollars to stop the rise of the euro, which has gained 9 percent against the dollar so far this year.

"It's created confusion in the market," said Niels Christensen, currency strategist at Nordea in London.

Butler, though, said it remains "tough to read between the lines and know whether the verbal chatter from the G7 is going to be enough to stem the euro's rise," adding that "the fundamentals indicate the euro has more room to the top side."