Investing.com – The euro eased off an 11-month low against the U.S. dollar on Thursday, but the single currency remained vulnerable amid a combination of fears over the debt crisis and the likelihood of a recession in the euro zone.
EUR/USD pulled back from 1.2956, the daily low, to hit 1.3015 during European early afternoon trade, rising 0.25%.
The pair was likely to find support at 1.2945, Wednesday’s low and an 11-month low and resistance at 1.3064, Wednesday’s high.
The shared currency found support after an auction of Spanish government debt met with stronger-than-expected investor demand earlier.
Spain’s Treasury sold EUR6 billion of medium-and-long-term bonds, far surpassing a target of EUR3.5 billion.
The country sold EUR2.5 billion of five-year bonds at an average yield of 4.02%, down sharply from 5.27% at a similar auction last month. Spain also auction EUR1.4 billion in ten-year bonds at a yield of 5.54%, compared to 6.97% at a November bond sale.
But the euro remained under pressure after the European Central Bank’s monthly report said the debt crisis in the region still posed a substantial threat to the economic outlook.
The report came after data showing that manufacturing activity in the euro zone rose unexpectedly in December, but remained in contraction territory for the fourth consecutive month.
A separate report showed that consumer price inflation in the euro zone remained unchanged at an annualized rate of 3% in December, in line with expectations.
The euro remained lower against the pound, with EUR/GBP slipping 0.08% to hit 0.8385.
Later Thursday, the U.S. was to produce its weekly report on initial jobless claims, as well as government data on producer price inflation and manufacturing activity in Philadelphia and New York state.
EUR/USD pulled back from 1.2956, the daily low, to hit 1.3015 during European early afternoon trade, rising 0.25%.
The pair was likely to find support at 1.2945, Wednesday’s low and an 11-month low and resistance at 1.3064, Wednesday’s high.
The shared currency found support after an auction of Spanish government debt met with stronger-than-expected investor demand earlier.
Spain’s Treasury sold EUR6 billion of medium-and-long-term bonds, far surpassing a target of EUR3.5 billion.
The country sold EUR2.5 billion of five-year bonds at an average yield of 4.02%, down sharply from 5.27% at a similar auction last month. Spain also auction EUR1.4 billion in ten-year bonds at a yield of 5.54%, compared to 6.97% at a November bond sale.
But the euro remained under pressure after the European Central Bank’s monthly report said the debt crisis in the region still posed a substantial threat to the economic outlook.
The report came after data showing that manufacturing activity in the euro zone rose unexpectedly in December, but remained in contraction territory for the fourth consecutive month.
A separate report showed that consumer price inflation in the euro zone remained unchanged at an annualized rate of 3% in December, in line with expectations.
The euro remained lower against the pound, with EUR/GBP slipping 0.08% to hit 0.8385.
Later Thursday, the U.S. was to produce its weekly report on initial jobless claims, as well as government data on producer price inflation and manufacturing activity in Philadelphia and New York state.