Investing.com – The euro erased gains against the yen on Thursday, falling to a six-week low after German Chancellor Angela Merkel said she still does not think common European bonds are necessary.
EUR/JPY pulled back from 103.45, the days high, to hit 102.86 during European afternoon trade, shedding 0.26%.
The pair was likely to find support at 101.58, the low of October 5 and resistance at 104.11, Wednesday’s high.
Speaking at a joint news conference with France's Nicolas Sarkozy and Italy's Mario Monti following a meeting earlier Merkel reiterated her belief that joint bonds would remove incentives for individual states to improve their fiscal discipline.
Earlier in the day, ratings agency Fitch downgraded Portugal’s sovereign rating to junk status, saying it expects gross domestic product to contract by 3% in 2012, making the government's deficit reduction plan far more challenging to execute.
The single currency found support during early trade after a report showed that German business confidence improved unexpectedly this month, indicating that the region’s debt crisis was not affecting the euro zone’s second largest economy as much as experts had initially feared.
The data came one day after the least successful German bond sale since the launch of the single currency sparked concerns over contagion to core euro zone economies.
The euro also erased gains against the U.S. dollar, with EUR/USD dipping 0.01% to hit 1.3340.
Meanwhile, markets in the U.S. were to remain closed on Thursday for Thanksgiving.
EUR/JPY pulled back from 103.45, the days high, to hit 102.86 during European afternoon trade, shedding 0.26%.
The pair was likely to find support at 101.58, the low of October 5 and resistance at 104.11, Wednesday’s high.
Speaking at a joint news conference with France's Nicolas Sarkozy and Italy's Mario Monti following a meeting earlier Merkel reiterated her belief that joint bonds would remove incentives for individual states to improve their fiscal discipline.
Earlier in the day, ratings agency Fitch downgraded Portugal’s sovereign rating to junk status, saying it expects gross domestic product to contract by 3% in 2012, making the government's deficit reduction plan far more challenging to execute.
The single currency found support during early trade after a report showed that German business confidence improved unexpectedly this month, indicating that the region’s debt crisis was not affecting the euro zone’s second largest economy as much as experts had initially feared.
The data came one day after the least successful German bond sale since the launch of the single currency sparked concerns over contagion to core euro zone economies.
The euro also erased gains against the U.S. dollar, with EUR/USD dipping 0.01% to hit 1.3340.
Meanwhile, markets in the U.S. were to remain closed on Thursday for Thanksgiving.