China move spurs markets

The Australian dollar jumped more than 1 percent and the euro hit a three-week high against the U.S. dollar in trading today as investors took China's commitment to allow more yuan flexibility as a signal to buy riskier assets.

China said on Saturday it would gradually make the yuan's exchange rate more flexible, indicating it was ready to break a 23-month-old U.S. dollar peg that had come under intense fire from abroad.

"Whether there are further gains will depend on how Asia trades its own currencies and on the yuan against the U.S. dollar fixing rate later today," said Westpac senior currency strategist Imre Speizer.