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Forex - EUR/USD moves sideways as market digest mixed data

Published 05/16/2014, 11:18 AM
Updated 05/16/2014, 11:20 AM
EUR/USD stays range bound on spotty U.S. data
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Investing.com - Hit-or-miss data in the U.S. and Europe sent the euro trading range bound against the dollar on Friday, with the pair jumping in and out of positive territory as investors digested economic indicators.

In U.S. trading, EUR/USD was down 0.04% at 1.3705, up from a session low of 1.3685 and off a high of 1.3726.

The pair was likely to find support at 1.3649, Thursday's low, and resistance at 1.3732, Thursday's high.

The preliminary Thomson Reuters/University of Michigan consumer sentiment index fell to 81.8 in May from 84.1 in April, confounding market expectations for a 84.5 reading, which softened the dollar.

On the flip side, the Census Bureau reported that U.S. building permits rose 8% to 1.080 million units last month, up from an upwardly revised 1.000 million in March. Analysts were expecting building permits to rise to 1.010 million units in April, and the better-than-expected figure gave the greenback support.

The report also showed that housing starts rose to 1.072 million units in April, from 947,000 in March, whose figure was revised up from a previously estimated 946,000. Analysts had expected building starts to rise to 980,000 units last month.

Meanwhile, the single currency continued to come under pressure after data released on Thursday revealed that the euro zone’s gross domestic product grew just 0.2% in the first quarter, missing expectations for a 0.4% growth rate. On a year-over-year basis the bloc’s economy expanded 0.9%, falling short of expectations for growth of 1.1%.

A separate report showed that the bloc's annual rate of inflation was unchanged at 0.7% in April, in line with forecasts, but still well below the ECB's target of close to but just under 2%.

Elsewhere, investors continued to track developments in Ukraine, as U.S. Secretary of State John Kerry warned Russia it faced broader economic and sector-related sanctions if it meddled in Ukraine's presidential elections on May 25.

The euro was down against the pound, with EUR/GBP down 0.27% to 0.8144, and down against the yen, with EUR/JPY down 0.12% at 139.10.

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