The euro gained more than 1.5% against the dollar on Wednesday as risk appetite returned to financial markets and commodity prices fell from recent peaks caused by the Russian invasion of Ukraine.

* After hitting a 22-month low of $1.0806 on Monday, the euro was trading at $1.10645, up 1.57% on the day.

* The rise was partly due to a report that quoted unnamed officials as saying the European Union was discussing joint bond issuance to finance additional energy and defense spending, said Mazen Issa, senior currency strategist at TD Securities.

* Just a month ago, the euro was close to touching the $1.15 barrier and its rapid depreciation below $1.10 may have been overdone, said Joseph Trevisani, senior analyst at

* “It was a very quick and crashing drop, so I think we’re seeing profit-taking and also a reversal in the market,” he said.

* Against a basket of currencies that includes the euro, the dollar index fell 1.077% to 98.052, after hitting a 22-month high on Monday.

* Markets were also buoyed by a pullback in commodity prices, which have been contributing to rising inflation and adding to the uncertainty surrounding expectations for economic growth.

* Some investors commented that a US ban on Russian oil sales may not worsen the tight supply situation and the head of the International Energy Agency said the agency could tap crude stockpiles further.

* European currencies such as the Polish zloty and the Hungarian forint rose sharply in value, recovering from record lows against the euro, also supported by interest rate hikes from local central banks.

* The European Central Bank (ECB) is due to meet on Thursday, but amid the specter of stagflation, money markets expect policymakers to delay plans to raise interest rates until the end of the year.

* Among cryptocurrencies, Bitcoin rose 8.71% to $42,130 and was on track for its biggest gain since Feb. 28, while ether climbed 5.06% to $2,708.

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