Investing.com - Fears negotiations in the U.S. to avoid the fiscal cliff continue to stall sparked safe-haven demand for the dollar on Thursday, which erased the euro's recent gains made against the greenback.
The market quickly looked past the Federal Reserve's monetary policy measures announced on Wednesday, under which the U.S. central bank will keep rates low until the unemployment rates hit 6.5%.
In U.S. trading on Thursday, EUR/USD was trading up 0.02% at 1.3077, up from a session low of 1.3041, and off from a high of 1.3100.
The pair was likely to find support at 1.2880, the low from Dec. 7, and resistance at 1.3127, the high from Dec. 6.
The dollar rose on safe-haven demand after investors quickly digested, applauded and later looked past the Fed's announcement to keep rates low and to beef up its stimulus program
The U.S. Federal Reserve is currently running a round of quantitative easing, a monetary stimulus tool that sees the U.S. central bank buy USD40 billion in mortgage-backed securities a month from banks on an open-ended basis to spur recovery, and going forward, the Fed will purchase an additional USD45 billion in Treasury holdings to spur recovery.
Benchmark interest rates remain unchanged at a target 0.25% though the Fed stressed they will stay that way also long as unemployment rates hover above 6.5% and provided inflation rates don't edge up to 2.5%.
However, concerns the U.S. policymakers remain at odds over how to avoid the fiscal cliff — a combination of tax hikes and deep spending cuts due to take effect at the end of the year and spark a recession — sent the euro giving back recent gains against the U.S. currency.
Soft retail sales did as well.
The Commerce Department reported earlier that U.S. retail sales increased by 0.3% in November from October, whose rates contracted by 0.3 percent.
November's figures still missed market forecasts for a gain of 0.5%, which further stoked risk-off trading sentiments.
Elsewhere, the Department of Labor reported earlier the number of people filing for initial jobless claims fell by 29,000 to 343,000 last week, beating expectations for a decline of 2,000.
The previous week’s figure was revised up to 372,000 from 370,000.
Meanwhile, official data showed that producer price inflation in the U.S. fell 0.8% last month, compared to forecasts for a 0.5% decline.
The euro, meanwhile, was up against the pound and up against the yen, with EUR/GBP trading up 0.28% at 0.8119, and EUR/JPY trading up 0.42% at 109.30.
The market quickly looked past the Federal Reserve's monetary policy measures announced on Wednesday, under which the U.S. central bank will keep rates low until the unemployment rates hit 6.5%.
In U.S. trading on Thursday, EUR/USD was trading up 0.02% at 1.3077, up from a session low of 1.3041, and off from a high of 1.3100.
The pair was likely to find support at 1.2880, the low from Dec. 7, and resistance at 1.3127, the high from Dec. 6.
The dollar rose on safe-haven demand after investors quickly digested, applauded and later looked past the Fed's announcement to keep rates low and to beef up its stimulus program
The U.S. Federal Reserve is currently running a round of quantitative easing, a monetary stimulus tool that sees the U.S. central bank buy USD40 billion in mortgage-backed securities a month from banks on an open-ended basis to spur recovery, and going forward, the Fed will purchase an additional USD45 billion in Treasury holdings to spur recovery.
Benchmark interest rates remain unchanged at a target 0.25% though the Fed stressed they will stay that way also long as unemployment rates hover above 6.5% and provided inflation rates don't edge up to 2.5%.
However, concerns the U.S. policymakers remain at odds over how to avoid the fiscal cliff — a combination of tax hikes and deep spending cuts due to take effect at the end of the year and spark a recession — sent the euro giving back recent gains against the U.S. currency.
Soft retail sales did as well.
The Commerce Department reported earlier that U.S. retail sales increased by 0.3% in November from October, whose rates contracted by 0.3 percent.
November's figures still missed market forecasts for a gain of 0.5%, which further stoked risk-off trading sentiments.
Elsewhere, the Department of Labor reported earlier the number of people filing for initial jobless claims fell by 29,000 to 343,000 last week, beating expectations for a decline of 2,000.
The previous week’s figure was revised up to 372,000 from 370,000.
Meanwhile, official data showed that producer price inflation in the U.S. fell 0.8% last month, compared to forecasts for a 0.5% decline.
The euro, meanwhile, was up against the pound and up against the yen, with EUR/GBP trading up 0.28% at 0.8119, and EUR/JPY trading up 0.42% at 109.30.