The euro has rallied to the dollar, reaching a 10-week high last week. Since mid-January, the euro is up 6.3%, from $1.265 to $1.345. Europe is obviously in a better mood after the eurozone finance ministers agreed to fund a long-delayed, second 130 billion euro ($175 billion) bailout for Greece last Tuesday. In the process, some private bondholders are now estimated to have suffered a 70% “haircut” in principal.

The British pound has also risen from $1.53 to $1.59 in the last six weeks. Last week, Britain’s Office for National Statistics announced that Britain’s January retail sales rose 0.9% — substantially better than economists’ consensus estimate of a 0.1% decline. An economist at HIS Global Insight called January’s retail sales “a major surprise,” and a “massive boost to hopes that the economy has returned to growth.”

Germany also was in a good mood after its central bank declared that the outlook for Germany’s economy has “perceptibly” improved. This verdict was reinforced on Thursday when Germany’s Ifo business climate index rose to 109.6 in February — up from 108.3 in January — reaching its highest level since July.

Asia’s economies are also recovering. Last Wednesday, the initial February flash estimate for HSBC’s (NYSE:HBC) Purchasing Managers Index for China rose to 49.7, up from 48.8 in January. With Asia and the rest of the world growing, the global demand for oil will also grow. This raises the delicate question of where Iran will be sending its 500,000 barrels per day of unsold oil.

Who will be the first to break the boycott?