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Forex - EUR/USD trims gains after upbeat U.S. data

Published 12/14/2010, 08:45 AM
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EUR/GBP
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Investing.com – The euro trimed gains against the U.S. dollar on Tuesday, retreating from a 3-week high, following the release of better-than-expected U.S. data on retail sales and producer price inflation.

EUR/USD retreated from 1.3497, the pair’s highest since November 23, to hit 1.3430 during European afternoon trade, gaining 0.29%.

The pair was likely to find support at 1.3181, Monday’s low and resistance at 1.3632, the high of November 23.

Earlier in the day, the U.S. Census Bureau said that retail sales rose 0.8% in November, after rising by a revised 1.7% the previous month. Analysts had expected retail sales to increase by 0.5% in November.

Core retail sales, which exclude automobile sales, rose significantly more-than-expected, increasing by 1.2%, after rising by a revised 0.8% in October.

A separate report showed that PPI rose by a seasonally adjusted 0.8% in November, after rising by 0.4% the previous month. Analysts had expected PPI to increase by 0.5% in November.

Core PPI, which excludes food and energy costs, rose 0.3% after falling by 0.6% in October.

Later in the day, the Federal Reserve was to announce its federal funds rate and release its December rate statement.

The euro was also up against the pound, with EUR/GBP gaining 0.55% to hit 0.8490.

Earlier Tuesday, the ZEW Centre for Economic Research said that its index of German economic sentiment rose in December, while separate data showed that industrial production in the euro zone rose less-than-expected in October.

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