Investing.com - The euro was mixed against its major counterparts on Wednesday, as concerns over the handling of the region’s ongoing sovereign debt crisis continued to weigh on the single currency.
During European late morning trade, the euro was mildly higher against the U.S. dollar, with EUR/USD adding 0.2% to hit 1.2275.
Spanish Prime Minister Mariano Rajoy announced EUR65 billion of new austerity measures earlier in the day, in an effort to meet new budget-deficit targets agreed with euro zone partners.
However, market analysts warned that the fresh austerity measures were likely to drag Spain’s economy deeper in to a recession.
The fresh budget cuts come a day after the conclusion of the latest meeting of euro zone finance ministers.
While the ministers agreed to grant Spain an extra year through 2014 to reach its deficit reduction targets, they did not come up with a final figure for aid for the country's ailing banks but said some EUR30 billion would be available by the end of this month.
Markets remained jittery after the German Constitutional Court delayed on Tuesday its decision on whether the euro zone's bailout fund, the European Stability Mechanism, is compatible with German law.
The court said a decision could take months rather than weeks due to the complexity of the ruling. Without German backing, the ESM, which was originally meant to start on July 1, then delayed to July 9, cannot come into effect.
Also Wednesday, Germany saw borrowing costs fall to a record low at an auction of 10-year government bonds, as sustained concerns over the region’s debt crisis continued to boost demand for safe haven bunds.
Meanwhile, the euro was lower against the pound, with EUR/GBP shedding 0.11% to trade at a three-and-a-half-year low of 0.7885.
Sterling remained supported after data on Tuesday showed that U.K. manufacturing production rose by 1.2% in May, blowing past expectations for a more modest 0.1% gain, after falling by 0.8% in April.
The single currency was little changed against the yen and Swiss franc, with EUR/JPY trading at 97.30 and EUR/CHF trading at 1.2011.
Elsewhere, the euro was mostly lower against the Canadian, Australian and New Zealand dollars, with EUR/CAD easing down 0.06% to hit 1.2520, EUR/AUD down 0.38% to hit 1.1975 and EUR/NZD shedding 0.22% to 1.5391.
Market players eyed the release of the minutes of the Federal Reserve’s most recent policy meeting later in the day, which could show whether the central bank is leaning toward more stimulus to boost growth.
During European late morning trade, the euro was mildly higher against the U.S. dollar, with EUR/USD adding 0.2% to hit 1.2275.
Spanish Prime Minister Mariano Rajoy announced EUR65 billion of new austerity measures earlier in the day, in an effort to meet new budget-deficit targets agreed with euro zone partners.
However, market analysts warned that the fresh austerity measures were likely to drag Spain’s economy deeper in to a recession.
The fresh budget cuts come a day after the conclusion of the latest meeting of euro zone finance ministers.
While the ministers agreed to grant Spain an extra year through 2014 to reach its deficit reduction targets, they did not come up with a final figure for aid for the country's ailing banks but said some EUR30 billion would be available by the end of this month.
Markets remained jittery after the German Constitutional Court delayed on Tuesday its decision on whether the euro zone's bailout fund, the European Stability Mechanism, is compatible with German law.
The court said a decision could take months rather than weeks due to the complexity of the ruling. Without German backing, the ESM, which was originally meant to start on July 1, then delayed to July 9, cannot come into effect.
Also Wednesday, Germany saw borrowing costs fall to a record low at an auction of 10-year government bonds, as sustained concerns over the region’s debt crisis continued to boost demand for safe haven bunds.
Meanwhile, the euro was lower against the pound, with EUR/GBP shedding 0.11% to trade at a three-and-a-half-year low of 0.7885.
Sterling remained supported after data on Tuesday showed that U.K. manufacturing production rose by 1.2% in May, blowing past expectations for a more modest 0.1% gain, after falling by 0.8% in April.
The single currency was little changed against the yen and Swiss franc, with EUR/JPY trading at 97.30 and EUR/CHF trading at 1.2011.
Elsewhere, the euro was mostly lower against the Canadian, Australian and New Zealand dollars, with EUR/CAD easing down 0.06% to hit 1.2520, EUR/AUD down 0.38% to hit 1.1975 and EUR/NZD shedding 0.22% to 1.5391.
Market players eyed the release of the minutes of the Federal Reserve’s most recent policy meeting later in the day, which could show whether the central bank is leaning toward more stimulus to boost growth.