Investing.com - The euro held steady against the dollar on Wednesday as markets continued to anticipate a formal request for a bailout out of Spain.
Trading was choppy, however, as the euro cooled its gains as Madrid has yet to formally request a financial lifeline.
In Asian trading on Wednesday, EUR/USD was trading down 0.04% at 1.2914, up from a session low of 1.2910, and off from a high of 1.2915.
The pair was likely to test support at 1.2880, Tuesday's low, and resistance at 1.2968, Tuesday's high.
A Reuters report that Spain may request a bailout in the coming days bolstered the euro, even though Germany was reportedly urging Madrid to hold off.
A bailout could open the door for the European Central Bank's to buy sovereign Spanish debt carrying maturities of up to three years, which would lower borrowing costs in the crisis-weary country.
Meanwhile, the Reserve Bank of Australia's decision to cut benchmark interest rates to by 25 basis points to 3.25 percent sparked some demand for higher-yielding currencies.
Concerns the Moody's rating agency's may downgrade Spain's sovereign rating to junk status kept trading choppy earlier.
Plus until Spain requests the bailout or flat out rejects plans to do so, uncertainty will keep the currency moving up and down in choppy trading, as was the case earlier.
Meanwhile in Europe, the eurozone's producer price index rose 0.9% in August from July, outpacing July's 0.3% gain from June.
Markets were expecting an August reading of 0.5%.
Year-over-year, the producer price index rose at an annualized rate of 2.7% in August, above expectations for a 2.6% gain, after climbing at a rate of 1.6% in July.
The euro, meanwhile, was down against the pound and up against the yen, with EUR/GBP trading down 0.03% at 0.8006, and EUR/JPY trading up 0.03% at 101.01.
Later Wednesday, the eurozone is to release revised data on service sector activity, as well as official data on retail sales.
Also on Wednesday, the U.S. is to produce industry data on non-farm employment change, followed by a report by the Institute for Supply Management on non-manufacturing activity, as well as government data on crude oil stockpiles.
Trading was choppy, however, as the euro cooled its gains as Madrid has yet to formally request a financial lifeline.
In Asian trading on Wednesday, EUR/USD was trading down 0.04% at 1.2914, up from a session low of 1.2910, and off from a high of 1.2915.
The pair was likely to test support at 1.2880, Tuesday's low, and resistance at 1.2968, Tuesday's high.
A Reuters report that Spain may request a bailout in the coming days bolstered the euro, even though Germany was reportedly urging Madrid to hold off.
A bailout could open the door for the European Central Bank's to buy sovereign Spanish debt carrying maturities of up to three years, which would lower borrowing costs in the crisis-weary country.
Meanwhile, the Reserve Bank of Australia's decision to cut benchmark interest rates to by 25 basis points to 3.25 percent sparked some demand for higher-yielding currencies.
Concerns the Moody's rating agency's may downgrade Spain's sovereign rating to junk status kept trading choppy earlier.
Plus until Spain requests the bailout or flat out rejects plans to do so, uncertainty will keep the currency moving up and down in choppy trading, as was the case earlier.
Meanwhile in Europe, the eurozone's producer price index rose 0.9% in August from July, outpacing July's 0.3% gain from June.
Markets were expecting an August reading of 0.5%.
Year-over-year, the producer price index rose at an annualized rate of 2.7% in August, above expectations for a 2.6% gain, after climbing at a rate of 1.6% in July.
The euro, meanwhile, was down against the pound and up against the yen, with EUR/GBP trading down 0.03% at 0.8006, and EUR/JPY trading up 0.03% at 101.01.
Later Wednesday, the eurozone is to release revised data on service sector activity, as well as official data on retail sales.
Also on Wednesday, the U.S. is to produce industry data on non-farm employment change, followed by a report by the Institute for Supply Management on non-manufacturing activity, as well as government data on crude oil stockpiles.