NEW YORK, 30 November 2006 — The dollar climbed yesterday, bolstered by a report showing faster US economic growth than previously estimated and warnings from European officials about the euro’s recent surge.

The US report increased expectations that the Federal Reserve can hold off on cutting interest rates. Higher rates make US securities more attractive and increase demand for the dollars.

Midway through the New York session, the euro fell 0.4 percent to $1.3148. The dollar was already up against major currencies before the US data, recovering from recent sharp losses that were triggered by growing expectations of a Federal Reserve interest-rate cut to counter weakening growth.

Earlier in the global trading day, French Prime Minister Dominique de Villepin said the single currency’s recent rise was weighing on competitiveness. French Finance Minister Thierry Breton said strong movements in currencies are never good, reiterating a call for collective vigilance.

Over the last week, the euro had risen nearly 3 percent against the dollar, bringing gains since January to more than 11 percent.

The dollar was up 0.2 percent at 116.26 yen in volatile trading as some investors tried to break through the 116.50-yen level.

The yen was supported early by surprisingly strong Japanese industrial output data that raised expectations the Bank of Japan might increase interest rates as early as December.

Later, investors tried to break the pair out of the 115.50- to 116.50-yen range. When that failed, the dollar fell against the yen before dollar buyers again stepped in for another assault on the upper end of that band.

Sterling last changed hands against the dollar down 0.2 percent at $1.9488. Earlier, the pound had climbed to a 2-year high of $1.9545.

Meanwhile, European stocks closed sharply higher yesterday. In London the FTSE 100 index gained 0.97 percent to close at 6,084.40 points, in Paris the CAC 40 leapt by 1.41 percent to 5,381.25 points while in Frankfurt the DAX added 1.31 percent to end the day at 6,363.80. The DJ Euro Stoxx 50 index of euro zone blue chip shares gained 1.21 percent to 4,023.09 points.

In New York, the Dow Jones Industrial Average was up 83.47 points, or 0.69 percent, at 12,219.92. The Standard & Poor’s 500 Index was up 10.75 points, or 0.78 percent, at 1,397.47. The NASDAQ Composite Index was up 18.68 points, or 0.77 percent, at 2,431.29.

Asian stocks rallied sharply higher yesterday. In Tokyo, the Nikkei-225 climbed 220.94 points to 16,076.20.