Forex - EUR/USD dips after G20 meeting disappoints

Published 02/27/2012, 02:33 AM
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Investing.com - The euro slipped against the U.S. dollar on Monday, pulling back from a 12-week high after a weekend meeting of the Group of 20 finance ministers failed to make progress on increasing the size of the International Monetary Fund’s lending capacity.

EUR/USD hit 1.3432 during late Asian trade, the session low; the pair subsequently consolidated at 1.3445, dipping 0.03%.

The pair was likely to find support at 1.3356, Friday’s low and resistance at 1.3549, the high of December 2.

The G-20 Group postponed a decision on a global bailout package to address the debt crisis in the euro zone and said any decision on outside help will be conditional upon on European governments increasing the size of their firewall in the next two months.

Germany has remained opposed to enlarging the size of the European Stability Mechanism, the permanent euro zone bailout fund that is to become active this year.

The euro remained supported as investors looked ahead to the European Central Bank's second liquidity operation, set to take place on Wednesday, after the bank carried out a similar successful operation in December.

The euro edged higher against the pound, with EUR/GBP inching up 0.04% to hit 0.8476.

Later in the day, Germany’s parliament was to hold an extraordinary session to vote on Greece’s second bailout, while the U.S. was to publish industry data on pending home sales.

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