Forex - EUR/USD higher on Greece hopes, China move

Published 02/20/2012, 02:28 AM
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Investing.com - The euro rose to a one-week high against the U.S. dollar on Monday, buoyed by hopes that a deal on a second bailout for Greece is growing closer and after China’s central bank announced fresh easing measures over the weekend.

EUR/USD hit 1.3237 during late Asian trade, the pair’s highest since February 13; the pair subsequently consolidated at 1.3193, gaining 0.41%.

The pair was likely to find support at 1.3114, Friday’s low and resistance at 1.3290, the high of February 10.

The euro found support amid hopes that a meeting of euro zone finance ministers later in the day would sign off on a EUR130 billion bailout and debt restructuring deal for Greece.

On Friday, German Chancellor Angela Merkel, Italian Prime Minister Mario Monti and Greek Prime Minister Lucas Papademos expressed optimism that an agreement would be reached at the meeting.

Market sentiment was also boosted after the People’s Bank of China announced a decision to cut the reserve requirement ratios of major commercial lenders in an attempt to boost liquidity and spur growth in the world’s second largest economy.

The euro was higher against the pound and the yen, with EUR/GBP rising 0.25% to hit 0.8321 and EUR/JPY up 0.26% to hit 104.79.

Also Monday, markets in the U.S. were to remain closed for the Presidents Day holiday.


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