The euro slipped to lower levels against the US dollar on Monday, following the data from last week and amid the persistent speculation over the timing of Feds Quantitative Easing pare back.
EUR/USD reached its highest point at 1.3342 during the early phase of Asian trade, after which fell to a session low at 1.3314 at 6:41 GMT. The pair consolidated at 1.3323, dipping 0.03% for the day. Support was expected at August 15th low, 1.3250, while resistance was to be met at August 15th high, 1.3369.
The single currency preserved its positions against the greenback, trading above 1.3300, after it became clear that economy in the Euro zone returned to growth during the second quarter of the year, ending an 18-month recessionary period. The German Federal Statistics Office is expected to report on Tuesday that producer prices in the country climbed by 0.2% in July compared to June, marking their first increase in six months. “We’re seeing some pretty clear signs that the euro zone has recovered from recession,” said Mike Jones, a currency strategist at Bank of New Zealand Ltd. in Wellington, cited by Bloomberg. “This week’s European flash PMI will certainly see that recovery trend shine through.”
Meanwhile, market players awaited the release of the minutes of Federal Reserve’s July meeting, scheduled on Wednesday, as it may provide clues on when the central bank may begin tapering its stimulus program. Policymakers will probably begin to pare back the central bank’s bond buying in September, according to 65% of experts surveyed by Bloomberg.
Elsewhere, the euro was lower against the British pound, as EUR/GBP cross dipped 0.11% to trade at 0.8525 at 7:23 GMT. EUR/JPY pair was almost without change, up by a mere 0.02% to trade at 130.09 at 7:23 GMT.
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