Investing.com - The euro traded higher against the U.S. dollar Thursday, as the release of weak U.S. data weakened greenback demand, although sustained euro zone debt concerns continued to weigh on the single currency.
EUR/USD traded at 1.2792, climbing 0.36% during U.S. afternoon trade.
The pair was likely to find support at 1.2718, the session low and resistance at 1.2876, the high of November 7.
The U.S. dollar came under pressure after the Federal Reserve Bank of Philadelphia said that its manufacturing index tumbled by 16.5 points to minus 107 in November from October’s reading of 5.7, contracting at the fastest rate in four months.
A separate report showed that the New York Federal Reserve’s index of manufacturing conditions improved unexpectedly in November, but remained in contraction territory for the fourth consecutive month.
Earlier in the session, the U.S. Department of Labor said the number of individuals filing for initial jobless benefits in the week ending November 10 rose by 78,000 to a seasonally adjusted 439,000, the highest level since April 2011, compared to expectations for an increase of 14,000 to 375,000.
In addition, data showed that consumer price inflation in the U.S. rose in line with expectations in October, while prices excluding food and energy costs increased more-than-expected.
Core CPI, which excludes food, energy, alcohol, and tobacco costs held steady at 1.5%, unchanged from a preliminary estimate and matching forecasts.
Meanwhile, the euro remained under pressure after official data released earlier showed that the region’s economy shrank 0.1% in the third quarter, following a contraction of 0.2% in the preceding quarter. A technical recession is defined as two straight quarters of contraction.
Year-on-year, euro zone gross domestic product fell 0.6% compared to a year earlier after contracting at a rate of 0.5% in the previous quarter.
The data came after reports showed that the pace of Germany's economic growth slowed to 0.2% in the third quarter from a 0.3% increase in the previous quarter, while France's economy’s expanded 0.2%, following contraction of 0.1% in the previous quarter.
A separate report showed that consumer price inflation in the euro zone held steady at 2.5% in October, unchanged from an initial estimate and in line with expectations.
Core CPI, which excludes food, energy, alcohol, and tobacco costs held steady at 1.5%, unchanged from a preliminary estimate and matching forecasts.
The euro was higher against the pound with EUR/GBP adding 0.27%, to hit 0.8061.
Later in the session, a speech by Federal Reserve Chairman Ben Bernanke was to be closely watched for any indications on the future possible direction of monetary policy.