Investing.com - The dollar firmed against the euro on Tuesday after a widely-watched U.S. manufacturing barometer beat expectations and sparked demand for the greenback by stoking sentiments the Federal Reserve will begin scaling back stimulus programs this month.
In U.S. trading on Tuesday, EUR/USD was down 0.34% at 1.3148, up from a session low of 1.3144 and off from a high of 1.3197.
The pair was likely to find support at 1.3068, the low from July 18, and resistance at 1.3398, last Wednesday's high.
The Institute for Supply Management reported earlier that its August purchasing managers’ index rose to 55.7 from 55.4 in July, beating analysts' calls for a 54.0 reading.
The report cemented views held by many that the Federal Reserve could start to unwind its USD85 billion monthly bond-buying program at its upcoming Sept. 17-18 policy meeting.
Monthly asset purchases weaken the dollar to spur recovery as long as they remain in effect, and talk of their dismantling can bolster the greenback.
Investors returned from a long, holiday weekend eager for the release of Friday’s U.S. nonfarm payrolls report, which is seen as a tipping point over whether the Fed will begin tapering asset purchases this month.
The euro, meanwhile, continued to come under pressure amid sentiments that monetary policy will remain unchanged and loose for the foreseeable future.
The euro was down against the pound and down against the yen, with EUR/GBP trading down 0.22% at 0.8469 and EUR/JPY trading down 0.10% at 130.90.
In the U.K., the construction sector expanded at its fastest pace in six years in August.
The Markit/CIPS August U.K. construction PMI rose to 59.1 from 57.0 in July. Economists were expecting a 58.3 reading.
The data fueled expectations that the Bank of England could raise interest rates sooner than it has previously indicated.
On Wednesday, the euro zone is to release official data on retail sales, while the U.S. is to release data on its trade balance.
In U.S. trading on Tuesday, EUR/USD was down 0.34% at 1.3148, up from a session low of 1.3144 and off from a high of 1.3197.
The pair was likely to find support at 1.3068, the low from July 18, and resistance at 1.3398, last Wednesday's high.
The Institute for Supply Management reported earlier that its August purchasing managers’ index rose to 55.7 from 55.4 in July, beating analysts' calls for a 54.0 reading.
The report cemented views held by many that the Federal Reserve could start to unwind its USD85 billion monthly bond-buying program at its upcoming Sept. 17-18 policy meeting.
Monthly asset purchases weaken the dollar to spur recovery as long as they remain in effect, and talk of their dismantling can bolster the greenback.
Investors returned from a long, holiday weekend eager for the release of Friday’s U.S. nonfarm payrolls report, which is seen as a tipping point over whether the Fed will begin tapering asset purchases this month.
The euro, meanwhile, continued to come under pressure amid sentiments that monetary policy will remain unchanged and loose for the foreseeable future.
The euro was down against the pound and down against the yen, with EUR/GBP trading down 0.22% at 0.8469 and EUR/JPY trading down 0.10% at 130.90.
In the U.K., the construction sector expanded at its fastest pace in six years in August.
The Markit/CIPS August U.K. construction PMI rose to 59.1 from 57.0 in July. Economists were expecting a 58.3 reading.
The data fueled expectations that the Bank of England could raise interest rates sooner than it has previously indicated.
On Wednesday, the euro zone is to release official data on retail sales, while the U.S. is to release data on its trade balance.