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Forex - EUR/USD erases gains after Philly Fed jumps

Published 12/16/2010, 10:46 AM
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EUR/GBP
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Investing.com – The euro erased gains against the U.S. dollar on Thursday, after official data showed that manufacturing in the Philadelphia region expanded in December at the fastest pace since April 2005 as orders and the factory workweek increased.

EUR/USD retreated from 1.3265, the daily high to hit 1.3191 during European late afternoon trade, shedding 0.17%.

The pair was likely to find support at 1.3059, the low of December 2 and resistance at 1.3381, Wednesday’s high.

Earlier in the day, the Federal Reserve Bank of Philadelphia said that its manufacturing index unexpectedly jumped to 24.3 in December, beating expectations for a decline to 14.1.

The report said increases in input prices were widespread and more firms reported increases in prices for their manufactured goods. In addition, the survey’s broad indicators of future activity suggested that optimism among the region’s manufacturing executives also continued to improve.

Also Thursday, the U.S. Department of Labor said the number of individuals filing for initial jobless benefits last week fell unexpectedly to 420,000. Analysts had expected initial jobless claims to rise to 425,000.

A separate report showed that the number of building permits issued in the U.S. fell unexpectedly in November, while housing starts rose more-than-expected.

The euro was also down against the pound, with EUR/GBP shedding 0.34% to hit 0.8471.

Earlier Thursday, official data showed that Ireland avoided slipping back into recession in the third quarter. Gross domestic product rose 0.5% in the quarter to October, rebounding from a 1% drop in the previous quarter but missing expectations for a 0.8% increase.

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