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Euro steady against dollar, ECB hopes supporting

Published 08/22/2012, 06:53 AM
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Investing.com - The euro was steady close to a seven-week high against the U.S. dollar on Wednesday, and remained supported against the other major currencies, buoyed by expectations that the European Central Bank is preparing policy measures to ease the debt crisis in the euro zone.

During European late morning trade, the euro was little changed against the U.S. dollar, with EUR/USD dipping 0.02% to 1.2468.

Overall market sentiment continued to be supported by speculation that the ECB will implement policy measures to help stabilize the euro zone's sovereign debt markets at its next policy meeting in September.

Investors were also looking ahead to a meeting between Jean-Claude Juncker, the head of the euro zone’s finance ministers, and Greek Prime Minister Antonis Samaras later in the day to discuss a two-year extension of the country’s economic reform program.

The single currency eased off a two-week high against the pound, with EUR/GBP slipping 0.09% to 0.7892.

Earlier Wednesday, Bank of England policymaker Adam Posen said the U.K. economy was stagnating and warned that if the situation in the euro zone deteriorated it would overwhelm the U.K. economy in ways that the central bank would not be able to counteract.

The euro was trading close to a six-week against the yen, with EUR/JPY easing down 0.10% to 98.79 and remained unchanged against the Swiss franc, with EUR/CHF trading at 1.2009.

In Japan, official data earlier showed that exports fell to the lowest level in six months in July, as the euro zone’s debt crisis and a slowdown in China hit demand.

The shared currency was mixed against the Australian, Canadian and New Zealand dollars, with EUR/AUD rising 0.38% to 1.1936, EUR/CAD gaining 0.23% to trade at 1.2365 and EUR/NZD up 0.15% to 1.5402.

Market participants were looking ahead to the minutes of the Federal Reserve’s August policy meeting later Wednesday, amid speculation over how close the U.S. central bank may be to implementing another round of stimulus measures.

In addition, the U.S. was to release industry data on existing home sales.


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