Investing.com - The euro extended losses against the yen on Monday, after official data showed that U.S. personal spending was unexpectedly flat last month, while investors remained wary ahead of the outcome of a European Union summit in Brussels.
EUR/JPY hit 100.33 during European afternoon trade, the pair’s lowest since January 24; the pair subsequently consolidated at 100.35, tumbling 1.01%.
The pair was likely to find support at 99.40, the low of January 20 and resistance at 101.44, the session high.
Risk appetite was hit after official data showed that U.S. personal spending was flat in December, confounding expectations for a 0.2% gain.
Personal spending for November rose by an unrevised 0.1%.
Consumer spending is the single biggest source of U.S. economic growth, accounting for as much as two-thirds of economic activity.
The euro came under broad selling pressure earlier as delays in negotiations between Greece and its private creditors on a debt restructuring plan soured sentiment on the single currency.
An agreement is necessary for Greece to secure its next tranche of bailout funds in order to avoid a default when a EUR14.5 billion bond repayment comes due on March 20.
The euro found some support after Italy successfully auctioned EUR7.48 billion of long term government debt at lower yields than in similar auctions one month ago.
The auction was a key test of Italy’s ability to raise funds on the international market, coming after a two notch downgrade of the country’s sovereign debt rating by Fitch Ratings on Friday.
But the yields on Portugal's 10-year government bonds rose above 15% on Monday, amid renewed fears the country may need a second international bailout.
Meanwhile, EU leaders were expected to finalize discussions on a pact aimed at enforcing deficit control measures in the region and to sign off on a EUR500 billion permanent rescue fund to be set up this year.
The euro was also sharply lower against the U.S. dollar, with EUR/USD dropping 0.92% to hit 1.3097.
Also Monday, preliminary data showed that consumer price inflation in Germany eased by 0.4% in January, compared to expectations for a decline of 0.5%, bringing the annualized rate of inflation to 2%, broadly in line with expectations.
EUR/JPY hit 100.33 during European afternoon trade, the pair’s lowest since January 24; the pair subsequently consolidated at 100.35, tumbling 1.01%.
The pair was likely to find support at 99.40, the low of January 20 and resistance at 101.44, the session high.
Risk appetite was hit after official data showed that U.S. personal spending was flat in December, confounding expectations for a 0.2% gain.
Personal spending for November rose by an unrevised 0.1%.
Consumer spending is the single biggest source of U.S. economic growth, accounting for as much as two-thirds of economic activity.
The euro came under broad selling pressure earlier as delays in negotiations between Greece and its private creditors on a debt restructuring plan soured sentiment on the single currency.
An agreement is necessary for Greece to secure its next tranche of bailout funds in order to avoid a default when a EUR14.5 billion bond repayment comes due on March 20.
The euro found some support after Italy successfully auctioned EUR7.48 billion of long term government debt at lower yields than in similar auctions one month ago.
The auction was a key test of Italy’s ability to raise funds on the international market, coming after a two notch downgrade of the country’s sovereign debt rating by Fitch Ratings on Friday.
But the yields on Portugal's 10-year government bonds rose above 15% on Monday, amid renewed fears the country may need a second international bailout.
Meanwhile, EU leaders were expected to finalize discussions on a pact aimed at enforcing deficit control measures in the region and to sign off on a EUR500 billion permanent rescue fund to be set up this year.
The euro was also sharply lower against the U.S. dollar, with EUR/USD dropping 0.92% to hit 1.3097.
Also Monday, preliminary data showed that consumer price inflation in Germany eased by 0.4% in January, compared to expectations for a decline of 0.5%, bringing the annualized rate of inflation to 2%, broadly in line with expectations.