The euro rose against the dollar for a second straight day on Thursday, hitting a one-week high on a dip in benchmark Italian and Spanish bond yields, but lingering concerns about the euro zone debt crisis should keep gains contained.
Italian three-year borrowing costs jumped more than one percentage point at a bond sale compared to a month ago, but 10-year yields in both Italy and Spain edged lower for a second straight day.
The euro rose to a one-week high of $1.3187 and last traded at $1.3174, up 0.5 percent on the day. The single-currency also gained against the yen, last trading at 106.54, up 0.5 percent.
The dollar last traded down 0.1 percent against the yen at 80.78, retreating from a high of 81.13 reached in the overnight session.