Oil prices not the only fuel for dollar decline

THE summer lull in foreign exchange markets came to an abrupt end last week, when the euro rallied to a three-month high against the dollar.

Late last week the euro bought more than $1.25 for the first time since late May for the first time since the market over-reacted to the defeat of the proposed European constitution in both France and Holland.

So what caused this rally in the single currency?