The euro advanced to a 16-month high against the yen and an 8-1/2-month peak versus the dollar on Wednesday, bolstered by better-than-expected German business confidence data and increasing optimism about debt-plagued Greece. The yen also weakened to its lowest in more than a year and a half against the dollar on expectations the Bank of Japan will ease monetary policy at the end of a two-day meeting Thursday.

The euro rose 0.3 percent to 111.73 yen, hitting 112.49, its highest since August 2011. Investors took out a reported options barrier at 112 yen. Against the dollar, the single euro zone currency rose to $1.3308, its strongest level since early April. By midday trading, the euro was up 0.2 percent at $1.3259. The dollar, however, rose against the yen to a 20-month high of 84.61 yen as it broke through an option barrier at 84.50. It triggered stop-loss buy orders above that level. The dollar last changed hands at 84.28 yen, up 0.1 percent.

Copyright Reuters, 2012