Investing.com - The euro extended gains against the dollar on Monday, rising back towards two month highs after data showed that private sector activity in the euro zone rose in December.
EUR/USD hit session highs of 1.3798, and was last up 0.33% to 1.3786, near the two month peak of 1.3809 struck last Wednesday.
The pair was likely to find support at 1.3726, the session low and near-term resistance at 1.3809.
The euro zone’s composite output index rose to a three month high of 52.1 in December, from 51.7 in November, indicating that European Central Bank policymakers will not need to step up stimulus measures. It was the fastest increase since April 2011.
New orders picked up to the highest level since mid-2011, fuelling optimism that the recovery in the region will carry forward into the start of 2014.
Rising exports helped push the euro zone’s manufacturing purchasing managers’ index up to a 31 month high of 52.7 in December, from a final reading of 51.6 in November.
However, the rate of expansion in the service sector ticked down to a four month low as domestic demand remained weak.
Private sector output in the euro zone’s largest economy continued to expand steadily in December, with Germany’s manufacturing PMI rising to a 30-month high, but the rate of decline in France accelerated, raising concerns that the country could fall back into a recession.
A separate report showed that the euro zone’s trade surplus rose to EUR17.2 billion in in October from EUR9.6 billion in October 2012 and was up from EUR10.9 billion in September.
Imports fell by 1.2% in October from a month earlier, while exports rose 0.2%.
Investors remained cautious ahead of the outcome of the Federal Reserve’s upcoming policy meeting on Wednesday, with some expecting the bank to announce a small reduction in the pace of its USD85 billion-a-month asset purchase program.
Markets were turning their attention to U.S. inflation data due out on Tuesday amid concerns that the subdued inflation outlook could prompt the Fed to keep its stimulus program in place for longer.
Elsewhere, the euro pushed higher against the yen, with EUR/JPY rising 0.13% to 141.98, up from session lows of 141.23.
EUR/USD hit session highs of 1.3798, and was last up 0.33% to 1.3786, near the two month peak of 1.3809 struck last Wednesday.
The pair was likely to find support at 1.3726, the session low and near-term resistance at 1.3809.
The euro zone’s composite output index rose to a three month high of 52.1 in December, from 51.7 in November, indicating that European Central Bank policymakers will not need to step up stimulus measures. It was the fastest increase since April 2011.
New orders picked up to the highest level since mid-2011, fuelling optimism that the recovery in the region will carry forward into the start of 2014.
Rising exports helped push the euro zone’s manufacturing purchasing managers’ index up to a 31 month high of 52.7 in December, from a final reading of 51.6 in November.
However, the rate of expansion in the service sector ticked down to a four month low as domestic demand remained weak.
Private sector output in the euro zone’s largest economy continued to expand steadily in December, with Germany’s manufacturing PMI rising to a 30-month high, but the rate of decline in France accelerated, raising concerns that the country could fall back into a recession.
A separate report showed that the euro zone’s trade surplus rose to EUR17.2 billion in in October from EUR9.6 billion in October 2012 and was up from EUR10.9 billion in September.
Imports fell by 1.2% in October from a month earlier, while exports rose 0.2%.
Investors remained cautious ahead of the outcome of the Federal Reserve’s upcoming policy meeting on Wednesday, with some expecting the bank to announce a small reduction in the pace of its USD85 billion-a-month asset purchase program.
Markets were turning their attention to U.S. inflation data due out on Tuesday amid concerns that the subdued inflation outlook could prompt the Fed to keep its stimulus program in place for longer.
Elsewhere, the euro pushed higher against the yen, with EUR/JPY rising 0.13% to 141.98, up from session lows of 141.23.