Investing.com - The dollar shot up against the euro on Tuesday as U.S. lawmakers and the White House grew closer to agreeing on a spending plan needed to reopen the government as well as avoid a default down the road.
The U.S. is due to hit its debt ceiling on Thursday, after which Washington won't be able to guarantee all of its obligations.
In U.S. trading on Monday, EUR/USD was down 0.49% at 1.3495, up from a session low of 1.3480 and off from a high of 1.3571.
The pair was likely to find support at 1.3478, the low from Sept. 30 , and resistance at 1.3598, Monday's high.
Lawmakers on Tuesday compared spending plans authored in both the Senate and the House with hopes all sides can eventually agree on terms to reopen the government as well as let it borrow to avoid defaulting on its obligations.
Both proposals would fund the government through Jan. 15, 2014, and would also suspend the U.S. debt limit until Feb. 7, 2014, and while no deal was in place at the time of writing, optimism that an accord will emerge soon sent the dollar rising.
Elsewhere, data released earlier revealed that an index of manufacturing activity in the New York region came in below expectations this month.
The Federal Reserve Bank of New York said that its general business conditions index fell to 1.52 for October from 6.29 in September. Analysts had expected a reading of 7.0.
The U.S. remained the main steering current for the pair on Tuesday.
The single currency failed to advance on news that German economic sentiment improved more than expected in October by rising to the highest level since April 2010.
The ZEW Centre for Economic Research said that its index of German economic sentiment rose by 3.2 points to hit 52.8 in October from September’s reading of 49.6. Analysts had expected an unchanged reading.
Elsewhere, the euro was down against the pound and down against the yen, with EUR/GBP trading down 0.41% at 0.8449 and EUR/JPY trading down 0.45% at 133.08.
On Wednesday, the euro zone is to release data on consumer price inflation.
The U.S. is due to hit its debt ceiling on Thursday, after which Washington won't be able to guarantee all of its obligations.
In U.S. trading on Monday, EUR/USD was down 0.49% at 1.3495, up from a session low of 1.3480 and off from a high of 1.3571.
The pair was likely to find support at 1.3478, the low from Sept. 30 , and resistance at 1.3598, Monday's high.
Lawmakers on Tuesday compared spending plans authored in both the Senate and the House with hopes all sides can eventually agree on terms to reopen the government as well as let it borrow to avoid defaulting on its obligations.
Both proposals would fund the government through Jan. 15, 2014, and would also suspend the U.S. debt limit until Feb. 7, 2014, and while no deal was in place at the time of writing, optimism that an accord will emerge soon sent the dollar rising.
Elsewhere, data released earlier revealed that an index of manufacturing activity in the New York region came in below expectations this month.
The Federal Reserve Bank of New York said that its general business conditions index fell to 1.52 for October from 6.29 in September. Analysts had expected a reading of 7.0.
The U.S. remained the main steering current for the pair on Tuesday.
The single currency failed to advance on news that German economic sentiment improved more than expected in October by rising to the highest level since April 2010.
The ZEW Centre for Economic Research said that its index of German economic sentiment rose by 3.2 points to hit 52.8 in October from September’s reading of 49.6. Analysts had expected an unchanged reading.
Elsewhere, the euro was down against the pound and down against the yen, with EUR/GBP trading down 0.41% at 0.8449 and EUR/JPY trading down 0.45% at 133.08.
On Wednesday, the euro zone is to release data on consumer price inflation.