The euro has been flirting with $1.40 the last two weeks and the currency appears poised to firmly capture and maintain that level Thursday (October 21) morning after economic reports from Europe and the US support a stronger euro-dollar.

One euro currently nets $1.3992 after moving as high as $1.4052 in late Europe and early New York currency trade.

Commentary from US Treasury Secretary Timothy Geithner has caught the attention of currency speculators early Thursday. Speaking at the Brookings Institution’s “The Path to Global Recovery”, Geithner supported the collaboration of G20 parties to establish some norms are foreign exchange that would help stabilize major currencies.

Geithner went on to say that practices used by some countries to devalue currencies for trade benefits were contributing to global economic issues. Geithner indicated that speculation that the US intends to devalue the dollar as part of the country’s economic recovery effort is unfounded. This is to be part of his upcoming message to G20 finance ministers.

The stronger euro is really the story on Thursday morning after economic data from Germany shows that company remains the current standard in the European Union. The euro is up against most other major currencies and has set a six month high against the British pound.

The euro has twice creased the $1.40 level in the last two weeks but quickly retreated. However, a strong surge through that mark Thursday morning and a modest pullback suggests the possibility of a firm break and hold later in the day.

The pound has not followed suit against the dollar as a weak retail sales report out of the UK on Thursday morning has the pound down roughly a pip at a current price of $1.5743.

The pound has traded mostly neutral against the greenback during the last five months in which the euro has soared by well over 20 pips.

Despite Geithner’s commentary that the US does not intend to intervene to shape a weaker dollar, speculation also suggests the Federal Reserve is unlikely to take proactive action that would increase the value of the greenback unless necessary for the economy.

Thus, with a zero to low interest rate policy still in play, a weak dollar is still the short-to-medium term likelihood.