LONDON, Dec 16: The euro rebounded against the dollar on Thursday after a successful bond auction by Spain, but gains were capped by investor caution before an EU summit to tackle the eurozone debt crisis.

In morning trading here, the euro rose to $1.3227 from $1.3211 in New York late on Wednesday. The dollar fell to 84.02 yen from 84.23 yen on Wednesday.

The single currency had fallen sharply against the greenback on Wednesday after Moody’s warned it might downgrade Spain’s credit rating because of the national debt, reviving fears about the eurozone economy.

In the wake of the warning, Spain on Thursday raised 2.4 billion euros ($3.2 billion) in a bond sale but had to pay higher rates on the debt.

In London on Thursday, the euro changed hands at $1.3227 against $1.3211 late in New York on Wednesday, at 111.14 yen (111.30), 0.8480 pounds (0.8497) and 1.2820 Swiss francs (1.2788).

The dollar stood at 84.02 yen (84.23) and 0.9692 Swiss francs (0.9676). The pound was at $1.5597 (1.5543).

On the London Bullion Market, the price of gold dropped to $1,384.60 an ounce from $1,388.75—AFP