EUR/USD close to session lows

The euro continued trading in proximity to session lows against the US dollar on Tuesday amid escalating geopolitical situation between the United States and Syria, which led to safe haven demand boost for the greenback.

EUR/USD fell sharply to a session low at 1.3325 at 8:10 GMT, also the pairs lowest point since August 22nd, after which consolidation followed at 1.3335. Support was expected at psychological 1.3300, while resistance was to be seen at current session high, 1.3390.

The euro ignored the upbeat series of data, released earlier out of Germany and continued its slide against the strong dollar, as fears of a possible military intervention by the united States in Syria grew, after US Secretary of State John Kerry said that President Barack Obama will hold Syrian government accountable for the usage of chemical weapons against the population.

The common currency touched daily highs for a short period of time, after today it became clear that German index of business climate rose sharply and exceeded expectations during August, as countrys export outlook was improving and economy was recovering at a steady pace, following the weak results at the beginning of the year. According to data, published by the IFO institute, the index of business climate increased for the fourth consecutive month in August to 107.5 from 106.2 in July, while preliminary estimates pointed a lesser increase, to 107.0. Business climate in manufacturing improved considerably, reaching its highest point since April 2012, as companies in the sector expected stronger results, regarding export. The reported value of the business climate index, however, remained below the all-time peak of 115.0, registered in February 2011.

The sub-index of economic expectations of companies in the next six months climbed to a reading of 103.3 in August from 102.4 in July. In addition, among the 7 000 German entities, participating in the IFO survey, most of them expressed optimism, regarding the current state of their business. The corresponding index of current assessment rose to a value of 112.0 during August from 110.1 in July, while projections pointed an advance to 111.0.

Meanwhile, the euro was gaining against the sterling, as EUR/GBP cross advanced 0.37% for the day to trade at 0.8617 at 13:30 GMT. On the other hand, EUR/JPY pair tumbled 1.22% on a daily basis to 130.12 at 13:31 GMT.