Investing.com - The euro fell to three-week lows against the U.S. dollar and the yen on Thursday, as hopes that an imminent European Union summit would deliver progress on tackling the region’s debt crisis faded.
During European late morning trade, the euro was lower against the U.S. dollar, with EUR/USD shedding 0.28% to trade at 1.2433.
Market sentiment was hit after a German government official indicated that the EU summit would not result in any detailed decisions and warned against high expectations among investors ahead of the conclusion of the summit on Friday.
Earlier in the week, German Chancellor Angel Merkel reiterated her opposition to the idea of joint euro zone bonds, while EU Economic and Monetary Affairs Commissioner Olli Rehn said Wednesday that the summit would focus on short-term measures to stabilize markets and ease pressure on at-risk countries.
Adding to the negative tone, Italy saw long term borrowing costs rose to 6.19%, their highest level since December, following an auction of 10-year bonds, as investor sentiment on the country continued to deteriorate.
Meanwhile, the yield on Spanish 10-year bonds ticked up to 7%, the level that prompted Greece, Ireland and Portugal to seek international bailouts.
The single currency was weaker against the yen, with EUR/JPY dropping 0.70% to 98.70, but remained steady against the Swiss franc, with EUR/CHF dipping 0.01% to 1.2009.
The euro edged lower against the pound, with EUR/GBP sliding 0.09% to trade at 0.8001.
In the U.K., official data confirmed that Britain’s economy contracted by 0.3% in the three months to March, but the contraction in the previous quarter was revised up to 0.4%, from a preliminary estimate of 0.3%.
A separate report showed that the U.K. current account deficit widened to GBP11.17 billion in the first quarter, from a shortfall of GBP7.22 billion in the fourth quarter.
The euro was down against the Canadian, Australian and New Zealand dollars, with EUR/CAD sliding 0.09% to hit 1.2766, EUR/AUD losing 0.17% to hit 1.2348 and EUR/NZD down 0.17% to hit 1.5720.
Elsewhere Thursday, official data showed that the number of unemployed people in Germany rose by a seasonally adjusted 7,000 in June, above expectations for an increase of 5,000, but the unemployment rate held steady at 6.8%.
Investors were looking ahead to U.S. government data on initial jobless claims and revised data on first quarter economic growth later in the session.
During European late morning trade, the euro was lower against the U.S. dollar, with EUR/USD shedding 0.28% to trade at 1.2433.
Market sentiment was hit after a German government official indicated that the EU summit would not result in any detailed decisions and warned against high expectations among investors ahead of the conclusion of the summit on Friday.
Earlier in the week, German Chancellor Angel Merkel reiterated her opposition to the idea of joint euro zone bonds, while EU Economic and Monetary Affairs Commissioner Olli Rehn said Wednesday that the summit would focus on short-term measures to stabilize markets and ease pressure on at-risk countries.
Adding to the negative tone, Italy saw long term borrowing costs rose to 6.19%, their highest level since December, following an auction of 10-year bonds, as investor sentiment on the country continued to deteriorate.
Meanwhile, the yield on Spanish 10-year bonds ticked up to 7%, the level that prompted Greece, Ireland and Portugal to seek international bailouts.
The single currency was weaker against the yen, with EUR/JPY dropping 0.70% to 98.70, but remained steady against the Swiss franc, with EUR/CHF dipping 0.01% to 1.2009.
The euro edged lower against the pound, with EUR/GBP sliding 0.09% to trade at 0.8001.
In the U.K., official data confirmed that Britain’s economy contracted by 0.3% in the three months to March, but the contraction in the previous quarter was revised up to 0.4%, from a preliminary estimate of 0.3%.
A separate report showed that the U.K. current account deficit widened to GBP11.17 billion in the first quarter, from a shortfall of GBP7.22 billion in the fourth quarter.
The euro was down against the Canadian, Australian and New Zealand dollars, with EUR/CAD sliding 0.09% to hit 1.2766, EUR/AUD losing 0.17% to hit 1.2348 and EUR/NZD down 0.17% to hit 1.5720.
Elsewhere Thursday, official data showed that the number of unemployed people in Germany rose by a seasonally adjusted 7,000 in June, above expectations for an increase of 5,000, but the unemployment rate held steady at 6.8%.
Investors were looking ahead to U.S. government data on initial jobless claims and revised data on first quarter economic growth later in the session.