Investing.com - The euro continued to slide against a strengthening dollar on Tuesday, as yields in U.S. government debt continued to rise, a sign that markets may be pricing in the possibility that the Federal Reserve may hike interest rates sooner than once anticipated.
In U.S. trading, EUR/USD was down 0.38% at 1.3541, up from a session low of 1.3534 and off a high of 1.3602.
The pair was likely to find support at 1.3503, Thursday's low, and resistance at 1.3677, Friday's high.
Rising Treasury yields, four months of solid monthly jobs reports and other upbeat economic indicators in the U.S. sent investors chasing the dollar on Tuesday.
On Friday, the U.S. Labor Department reported that the economy added 217,000 in May, close to expectations for a 218,000 increase.
It was the fourth consecutive month in which the U.S. economy added more than 200,000 new nonfarm payrolls.
The private sector added 216,000 jobs last month, exceeding expectations for a 210,000 gain.
Meanwhile, Treasury yields in the U.S. continued to rise on expectations that Thursday's retail sales report will come in strong, prompting investors to reevaluate when the Federal Reserve will hike interest rates.
Fed officials have said some time will pass between the time monetary authorities wrap up stimulus programs, currently seen taking place at the end of this year, and when interest rates rise, forecast to take place sometime in 2015, though the timing of such still remains up in the air.
The yield on the U.S. U.S. 10-Year Treasury note rose to 2.65% on Tuesday, its highest in a month.
The euro, meanwhile, came under pressure on sentiments that policy will remain accommodative for the foreseeable future.
Last Thursday, the ECB unveiled a package of measures to battle persistently low inflation rates in the euro area, including cuts to interest rates, though markets still haven't rule out further action if inflation rates don't pick up.
Elsewhere, the euro was down against the pound, with EUR/GBP down 0.07% at 0.8084, and down against the yen, with EUR/JPY down 0.44% at 138.74.