Investing.com – The euro extended losses against the U.S. dollar on Tuesday, retreating from a five-month high after a one-notch downgrade of Portugal's sovereign debt rating by Moody's.
EUR/USD hit 1.4159 during European late morning trade, the pair’s lowest since Friday; the pair subsequently consolidated at 1.4165, shedding 0.38%.
The pair was likely to find support at 1.4061, last Friday’s low and resistance at 1.4267, Monday’s high and a five-month high.
Earlier in the day, Moody's Investors Service downgraded Portugal's sovereign debt rating from A3 to Baa1 and warned that it expected the country’s incoming government would have to seek financial aid from the European Union as a matter of urgency.
Following the downgrade, yields on Portugal's 10-year government bonds rose to a euro-lifetime high of 9.03%.
The euro was also pressured by the view that expectations for a rate hike by the European Central Bank later in the week have been priced in by investors.
The central bank was widely expected to raise interest rates by 0.25% from a record low of 1% on Thursday to curb inflationary pressures.
The euro was also lower against the pound, with EUR/GBP tumbling 0.95% to hit 0.8731.
Later Tuesday, the U.S. was to publish data on service sector growth while the Federal Reserve was to publish the minutes of its most recent policy setting meeting.
EUR/USD hit 1.4159 during European late morning trade, the pair’s lowest since Friday; the pair subsequently consolidated at 1.4165, shedding 0.38%.
The pair was likely to find support at 1.4061, last Friday’s low and resistance at 1.4267, Monday’s high and a five-month high.
Earlier in the day, Moody's Investors Service downgraded Portugal's sovereign debt rating from A3 to Baa1 and warned that it expected the country’s incoming government would have to seek financial aid from the European Union as a matter of urgency.
Following the downgrade, yields on Portugal's 10-year government bonds rose to a euro-lifetime high of 9.03%.
The euro was also pressured by the view that expectations for a rate hike by the European Central Bank later in the week have been priced in by investors.
The central bank was widely expected to raise interest rates by 0.25% from a record low of 1% on Thursday to curb inflationary pressures.
The euro was also lower against the pound, with EUR/GBP tumbling 0.95% to hit 0.8731.
Later Tuesday, the U.S. was to publish data on service sector growth while the Federal Reserve was to publish the minutes of its most recent policy setting meeting.