Investing.com - The euro slid to a one-week low against the pound on Wednesday, after the European Central Bank’s second long-term refinancing operation encountered more bidders than the bank's previous operation, while the amount allotted was broadly in line with market expectations.
EUR/GBP hit 0.8425 during European morning trade, the pair’s lowest since February 22; the pair subsequently consolidated at 0.8434, shedding 0.34%.
The pair was likely to find support at 0.8377, the low of February 22 and resistance at 0.8469, the session high.
The ECB said that it had allotted EUR529 billion in three-year loans to European lenders, after receiving bids from 800 banks, significantly more than in the bank’s first long term refinancing operation late last year.
In December, the EBC issued EUR489 billion in three-year loans to 523 banks, averting a liquidity shortage in the euro zone’s banking system and easing pressure on the region’s bond markets.
The high uptake on the operation sparked concerns that banks in the region expect liquidity pressures to continue.
Meanwhile, official data showed that consumer price inflation in the euro zone eased unexpectedly in January, rising by a seasonally adjusted 2.6%, down from a preliminary estimate of 2.7%.
Analysts had expected euro zone consumer prices to remain unchanged.
The euro was also lower against the U.S. dollar and the yen, with EUR/USD sliding 0.14% and EUR/JPY dipping 0.07% to hit 108.20.
Later in the day, Finland’s parliament was to vote on Greece’s bailout, while the U.S. was to release a preliminary report on fourth-quarter gross domestic product.
In addition, Federal Reserve Chairman Ben Bernanke was due to testify on the semi-annual monetary policy report before the House Financial Services Committee in Washington.
EUR/GBP hit 0.8425 during European morning trade, the pair’s lowest since February 22; the pair subsequently consolidated at 0.8434, shedding 0.34%.
The pair was likely to find support at 0.8377, the low of February 22 and resistance at 0.8469, the session high.
The ECB said that it had allotted EUR529 billion in three-year loans to European lenders, after receiving bids from 800 banks, significantly more than in the bank’s first long term refinancing operation late last year.
In December, the EBC issued EUR489 billion in three-year loans to 523 banks, averting a liquidity shortage in the euro zone’s banking system and easing pressure on the region’s bond markets.
The high uptake on the operation sparked concerns that banks in the region expect liquidity pressures to continue.
Meanwhile, official data showed that consumer price inflation in the euro zone eased unexpectedly in January, rising by a seasonally adjusted 2.6%, down from a preliminary estimate of 2.7%.
Analysts had expected euro zone consumer prices to remain unchanged.
The euro was also lower against the U.S. dollar and the yen, with EUR/USD sliding 0.14% and EUR/JPY dipping 0.07% to hit 108.20.
Later in the day, Finland’s parliament was to vote on Greece’s bailout, while the U.S. was to release a preliminary report on fourth-quarter gross domestic product.
In addition, Federal Reserve Chairman Ben Bernanke was due to testify on the semi-annual monetary policy report before the House Financial Services Committee in Washington.