Investing.com - The euro was trading close to three-week highs against the dollar on Monday after former U.S. Treasury Secretary Larry Summers withdrew from the contest to be the next head of the Federal Reserve.
EUR/USD hit 1.3382 during European afternoon trade, the highest since August 28; the pair subsequently consolidated at 1.3356, advancing 0.45%.
The pair was likely to find support at 1.3253, Friday’s low and resistance at 1.3400.
Risk appetite sharpened after Summers’ pulled out of the race to succeed Ben Bernanke as the next Fed chairman. Markets had viewed Summers’ as being likely to roll back economic stimulus measures more aggressively than his main rival for the post, Janet Yellen.
Investors were also focusing on the outcome of the upcoming Fed policy meeting, which concludes on Wednesday, after a recent series of lukewarm U.S. data raised doubts over whether the central bank will start to taper its USD85 billion-a-month bond buying program this month.
Meanwhile, European Central Bank President Mario Draghi said Monday that the economic recovery in the euro zone remains “fragile” and reiterated that interest rates will remain at current or lower levels for an “extended period”.
The comments came during a speech in Berlin.
Separately, data showed that consumer price inflation in the euro zone remained steady at 1.3% on a year-over-year basis in August, unchanged from an initial estimate and in line with expectations.
The single currency was slightly higher against the pound, with EUR/GBP easing up 0.115 to 0.8382 and edged lower against the yen, with EUR/JPY dipping 0.03% to 132.05.
The U.S. was to publish the Empire state manufacturing index as well as data on industrial production and the capacity utilization rate later in the trading day.
EUR/USD hit 1.3382 during European afternoon trade, the highest since August 28; the pair subsequently consolidated at 1.3356, advancing 0.45%.
The pair was likely to find support at 1.3253, Friday’s low and resistance at 1.3400.
Risk appetite sharpened after Summers’ pulled out of the race to succeed Ben Bernanke as the next Fed chairman. Markets had viewed Summers’ as being likely to roll back economic stimulus measures more aggressively than his main rival for the post, Janet Yellen.
Investors were also focusing on the outcome of the upcoming Fed policy meeting, which concludes on Wednesday, after a recent series of lukewarm U.S. data raised doubts over whether the central bank will start to taper its USD85 billion-a-month bond buying program this month.
Meanwhile, European Central Bank President Mario Draghi said Monday that the economic recovery in the euro zone remains “fragile” and reiterated that interest rates will remain at current or lower levels for an “extended period”.
The comments came during a speech in Berlin.
Separately, data showed that consumer price inflation in the euro zone remained steady at 1.3% on a year-over-year basis in August, unchanged from an initial estimate and in line with expectations.
The single currency was slightly higher against the pound, with EUR/GBP easing up 0.115 to 0.8382 and edged lower against the yen, with EUR/JPY dipping 0.03% to 132.05.
The U.S. was to publish the Empire state manufacturing index as well as data on industrial production and the capacity utilization rate later in the trading day.