Forex - EUR/USD gains as Bernanke won't rule out easing

Published 08/31/2012, 10:29 AM
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Investing.com - The euro rose against the dollar on Friday as investors sold the greenback after Federal Reserve Chairman Ben Bernanke said in a speech that the U.S. central bank won't rule out further monetary easing though there are no concrete plans to do as such for now.

In U.S. trading on Friday, EUR/USD was trading up 0.68% at 1.2591, up from a low of 1.2494 and off from a high of 1.2628.

The pair was likely to find support at 1.2494, the earlier low, and resistance at 1.2628, the ealier high.

Bernanke said in his speech at the Fed's annual symposium in Jackson Hole, Wyoming, that the Fed remains ready to intervene with stimulus though the speech made no mention for more specific plans.

The costs of nontraditional policies, when considered carefully, appear manageable, implying that we should not rule out the further use of such policies if economic conditions warrant," Bernanke said in prepared remarks at his speech.

"Over the past five years, the Federal Reserve has acted to support economic growth and foster job creation, and it is important to achieve further progress, particularly in the labor market. Taking due account of the uncertainties and limits of its policy tools, the Federal Reserve will provide additional policy accommodation as needed to promote a stronger economic recovery and sustained improvement in labor market conditions in a context of price stability."

Elsewhere in the U.S., the Chicago PMI fell more than expected in July, data showed on Friday.

In a report, research group Kingsbury International said that the Chicago PMI fell to a seasonally adjusted 53.0, from 53.7 in the preceding month.

Analysts had expected the Chicago PMI to fall to 53.5 last month.

The euro, meanwhile, was up against the pound and up against the yen, with EUR/GBP up 0.35% at 0.7950, and EUR/JPY trading up 0.40% at 98.73.









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