Euro leaps to one-month dollar high

In early morning deals, the euro jumped to US$1.3457 -- which was the highest level since December 14. It later stood at US$1.3368 from US$1.3358 in New York late on Thursday.

Spain proved it can tap the financial markets for money, selling its maximum target of €3.0 billion in five-year bonds with demand outstripping supply by two-to-one.

Italy soothed European debt concerns, too, raising its maximum target of €6.0 billion in bonds Thursday.

The shared eurozone unit also rallied following Thursday's hawkish comments from ECB President Jean-Claude Trichet on inflation.

After the central bank announced it would keep its main interest rate at a record low of one percent for a 20th straight month, Trichet told journalists:

"It is absolutely crystal clear that we will always do what is necessary to deliver price stability."

"We are never pre-committed not to move interest rates," he added.

In a separate development, China's central bank said it would raise the amount of money that banks are required to keep in reserve, the latest in a series of such hikes aimed at reining in high inflation.

The bank reserve requirement ratio would be raised by 50 basis points beginning on January 20, the People's Bank of China said in a statement.

Ever fearful of inflation's potential to spark social unrest, Beijing has been pulling on a variety of levers to rein in consumer prices and calm growing anxiety about soaring food costs and property values.