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Forex - EUR/USD extends losses as Portugal debt auction eyed

Published 01/05/2011, 05:55 AM
EUR/USD
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EUR/GBP
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Investing.com – The euro extended early losses against the U.S. dollar on Wednesday, sliding to a four-day low ahead of a closely watched auction of Portuguese Treasury bills.

EUR/USD hit 1.3236 during European morning trade, the pair’s lowest since December 30; the pair subsequently consolidated at 1.3244, shedding 0.49%.

The pair was likely to find support at 1.3082, the low of December 29 and resistance at 1.3344, Tuesday’s high.

Portugal was to auction EUR500 million of six-month Treasury bills later Wednesday.  Question marks over the country’s shaky public finances at the end of 2010 saw its borrowing costs soar, with yields on 10-year bonds jumping to 6.6%, from 4.0% at the end of 2009.

 By comparison, yields on 10-year German bonds, the euro zone benchmark, fell to 2.9% from 3.3%.

Also Wednesday, official data showed that industrial new orders in the euro zone rose slightly less-than-expected in October, climbing 1.4%, less than the forecasted 1.6% increase.

The euro was also down against the pound, with EUR/GBP losing 0.52% to hit 0.8492.

Later in the day, the U.S. was to publish a jobs report by Automatic Data Processing as well as data from the Institute of Supply Management on service sector activity.

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