_800x533_L_1411549591.jpg)
Investing.com - The dollar strengthened to three-month highs against the euro on Friday after data revealed more new homes were sold in the U.S. in April than markets were expecting, a sign the housing sector is on the mend.
In U.S. trading, EUR/USD was down 0.19% at 1.3630, up from a session low of 1.3616 and off a high of 1.3688.
The pair was likely to find support at 1.3483, the low from Feb. 6, and resistance at 1.3723, Wednesday's high.
The housing sector, which threw the U.S. economy into the worst downturn since the Great Depression and lagged on its recovery for years, is on the mend.
The Census Bureau reported earlier that U.S. new home sales rose 6.4% to 433,000 units in April from 407,000 units in March, whose figure was revised up from a previously estimated 384,000. Analysts had expected new home sales to rise to 425,000 units last month.
A day earlier, the National Association of Realtors reported that existing home sales increased 1.3% in April to an annual rate of 4.65 million units, and hopes that the U.S. housing sector is improving strengthened demand for the dollar on Friday.
Meanwhile, the euro came under pressure after the Ifo Institute for Economic Research reported earlier that its German business climate index ticked down to a five-month low of 110.4 in May, from a reading of 111.2 the previous month. Analysts had expected the index to fall to 110.9.
The report came a day after data showed that manufacturing activity in the euro zone expanded at its slowest rate in six months in May, although the region’s service sector expanded at the fastest rate in almost three years.
Also in Europe, Germany's first-quarter gross domestic product grew 0.8% from the previous quarter and 2.5% on year, the first figure in line with expectations though the on-year figure beat market calls for a 2.3% growth rate.
The euro was flat against the pound, with EUR/GBP unchanged at 0.8095, and down against the yen, with EUR/JPY down 0.07% at 138.82.