Forex - EUR/USD edges up on EFSF expansion hopes

Published 09/27/2011, 02:37 AM
EUR/USD
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EUR/GBP
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Investing.com – The euro edged higher against the U.S. dollar on Tuesday, boosted by speculation that European Union leaders are examining ways to beef up the region’s bailout fund, the European Financial Stability Facility.

EUR/USD hit 1.3566 during late Asian trade, the pair’s highest since Friday; the pair subsequently consolidated at 1.3549, easing up 0.11%.

The pair was likely to find support at 1.3361, Monday’s low and an eight-month low and resistance at 1.3693, the high of September 12.

On Monday, a senior European Central Bank policymaker said the funds in the EUR440 billion EFSF could be used as collateral to borrow from the ECB, making more money available.

But the single currency remained under pressure ahead of votes on expanding the role of the EFSF later in the week. The measures have to be passed by of the currency bloc's governments before steps to expand its role can be implemented.

Meanwhile, the Greek government was to vote on a new round of austerity measures needed to secure aid later in the day.

Elsewhere, the euro slipped against the pound, with EUR/GBP sliding 0.09% to hit 0.8685.

Also Tuesday, a report showed that an index of German consumer climate remained unchanged at 5.2 in August. Analysts had expected the index to decline to 5.1.

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