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Euro steady as markets eye central banks

Published 08/30/2012, 06:44 AM
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Investing.com - The euro was stuck in a tight range against the other major currencies on Thursday, as investors awaited a speech by Federal Reserve Chairman Ben Bernanke on Friday and details of European Central Bank plans to help lower high Spanish and Italian borrowing costs.

During European late morning trade, the euro was hovering close to a seven-week high against the U.S. dollar, with EUR/USD inching up 0.09% to 1.2541.

Investors remained cautious ahead of Bernanke’s speech, amid ongoing speculation over how close the Fed may be to implementing more economic stimulus measures.

In the euro zone, Italy saw borrowing costs ease at an auction of five and 10-year bonds, reflecting expectations that the European Central Bank is working on measures to help stabilize the euro zone's sovereign debt markets ahead of its upcoming meeting on September 6.

Italy’s Treasury auctioned EUR4 billion of 10-year bonds at an average yield of 5.82%, down from 5.96% last month and the lowest level since March.

In addition, Italy sold EUR2.5 billion of five-year bonds at an average yield of 4.73%, down from 5.29% last month, also the lowest rate since March.

The single currency was slightly higher against the pound, with EUR/GBP easing up 0.11% to 0.7922.

In the U.K., official data showed that net lending to individuals increased by GBP0.9 billion in July, below expectations for a GBP1.1 billion increase.

A separate report showed that U.K. mortgage approvals rose to 47,000 in July, in line with expectations, coming off June’s 18-month low of 44,000.

The euro was little changed close to a six-week high against the yen, with EUR/JPY edging up 0.01% to 98.61 and remained unchanged against the Swiss franc, with EUR/CHF trading at 1.2009.

The shared currency remained supported against the Australian, Canadian and New Zealand dollars, with EUR/AUD up 0.28% to 1.2141, EUR/CAD climbing 0.31% to trade at 1.2435 and EUR/NZD edging up 0.03% to 1.5655.

Later in the day, the U.S. was to release official data on personal income as well as a weekly report on jobless claims.



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