Investing.com - The euro rose to seven-week highs against the U.S. dollar on Tuesday, as the release of upbeat euro zone economic reports supported demand for risk-related assets, while markets eyed U.S. trade balance data later in the day.
EUR/USD hit 1.3939 during European afternoon trade, the pair's highest since March 18; the pair subsequently consolidated at 1.3937, gaining 0.45%.
The pair was likely to find support at 1.3865, Monday's low and resistance at 1.3966, the high of March 13.
The single currency found support after official data showed that euro zone retail sales rose 0.3% in March, confounding expectations for a 0.2% fall. Retail sales in February were revised down to a 0.1% gain from a previously estimated 0.4% increase.
The report came after official data showed that the number of unemployed people in Spain dropped by 111,600 in April, compared to expectationd for a decline of 49,100, after a 16,600 fall the previous month.
Separately, Markit research group said that Spain's services purchasing managers' index rose to a six-year high of 56.5 last month, from a reading of 54.0 in March. Analysts had expected the index to tick up to 54.4 in April.
Italy's services PMI swung back into expansion territory last month, rising to 51.1 from a reading of 49.5 in March, beating expectations for an uptick to 50.4.
The euro was lower against the pound, with EUR/GBP slipping 0.18% to 0.8211.
Demand for sterling strengthened after Markit said the U.K. services PMI rose to a four-month high of 58.7 last month, from a reading of 57.6 in March. Analysts had expected the index to remain unchanged in April.
The upbeat data added to expectations the Bank of England could raise borrowing costs ahead of other central banks.