Investing.com – The euro rallied against the U.S. dollar on Tuesday, as a string of better-than-expected economic data boosted demand for higher yielding assets but gains looked set to be capped amid persistent concerns over the financial crisis in the euro zone.
EUR/USD hit 1.3059 during European late morning trade, the pair’s highest since December 28; the pair subsequently consolidated at 1.3052, surging 0.92%.
The pair was likely to find support at 1.2917, Monday’s low and resistance at 1.3118, the high of December 22.
Earlier Tuesday, official data showed that the number of unemployed people in Germany fell more-than-expected in December, while the country’s jobless rate dropped to a record low.
The report came a day after data indicating a slowdown in the rate of contraction in the manufacturing sector in the euro zone.
Market sentiment was also bolstered by Sunday’s stronger-than-expected Chinese manufacturing data.
However, the euro’s gains looked likely to remain limited as the threat of sovereign debt downgrades across the single currency bloc lingered, while investors looked ahead to bond auctions by Germany and France later in the week to gauge borrowing conditions in the region.
The euro was also higher against the pound and the yen, with EUR/GBP rising 0.32% to hit 0.8364 and EUR/JPY climbing 0.66% to hit 100.10, after falling to as low as 99.35 in holiday-thinned trade on Monday, the lowest level since December 2000.
Later Tuesday, the U.S. Institute of Supply Management was to publish a report on manufacturing activity, while the Federal Reserve was to publish the minutes of its December policy meeting.
EUR/USD hit 1.3059 during European late morning trade, the pair’s highest since December 28; the pair subsequently consolidated at 1.3052, surging 0.92%.
The pair was likely to find support at 1.2917, Monday’s low and resistance at 1.3118, the high of December 22.
Earlier Tuesday, official data showed that the number of unemployed people in Germany fell more-than-expected in December, while the country’s jobless rate dropped to a record low.
The report came a day after data indicating a slowdown in the rate of contraction in the manufacturing sector in the euro zone.
Market sentiment was also bolstered by Sunday’s stronger-than-expected Chinese manufacturing data.
However, the euro’s gains looked likely to remain limited as the threat of sovereign debt downgrades across the single currency bloc lingered, while investors looked ahead to bond auctions by Germany and France later in the week to gauge borrowing conditions in the region.
The euro was also higher against the pound and the yen, with EUR/GBP rising 0.32% to hit 0.8364 and EUR/JPY climbing 0.66% to hit 100.10, after falling to as low as 99.35 in holiday-thinned trade on Monday, the lowest level since December 2000.
Later Tuesday, the U.S. Institute of Supply Management was to publish a report on manufacturing activity, while the Federal Reserve was to publish the minutes of its December policy meeting.