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Forex - EUR/USD higher on nonfarm payroll anticipation, German numbers

Published 09/07/2012, 07:09 AM
Updated 09/07/2012, 07:10 AM
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Investing.com - The euro traded higher against the U.S. dollar  Friday as traders anticipate the release of the U.S. nonfarm payroll numbers later in the session, while strong German economic data lifted the single currency.

EUR/USD hit 1.2695 during European trade, the pair's highest since June 21; the pair subsequently consolidated at 1.2692, advancing 0.47%.

The pair was likely to find support at 1.2627, the day's low and resistance at 1.2815, the high of May 22.

Investors are anticipating the release of U.S. nonfarm payroll data and the unemployment numbers with expectations pointing toward an upward surprise based on U.S. index futures trading higher on the session.

The single currency advanced after official data showed that industrial production in Germany climbed by 1.3% in July, beating expectations for a 0.2% rise and following a revised 0.4% decline the previous month. 

The data came after European Central Bank Mario Draghi unveiled on Thursday a new bond-purchasing program, dubbed Outright Monetary Transactions, which he said will provide "a fully effective backstop" against market volatility.

Speaking at the bank’s post-policy meeting press conference, Draghi said "strict and effective conditionality” was an essential element of the plan.

Under the terms of the plan, the ECB would buy unlimited amounts of government bonds of up to three years in maturity, as long as the country in question is signed up to the OMT program and agrees to economic reforms.

The euro was also higher against the pound with EUR/GBP rising 0.50%, to hit 0.7969.



 

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