Investing.com - The euro was almost unchanged against the U.S. dollar in thin trade on Wednesday, as a successful Italian bond auction failed to ease concerns over the debt crisis in the euro zone ahead of a ten-year debt sale on Thursday.
EUR/USD hit 1.3057 during European afternoon trade, the daily low; the pair subsequently consolidated at 1.3068, easing 0.02%.
The pair was likely to find support at 1.3016, the low of December 22 and resistance at 1.3131, the high of December 20.
With most investors already away on year-end leave, trading volumes were thin, resulting in tight liquidity conditions and irregular volatility.
The euro found support after a stronger-than-expected auction of Italian government debt earlier in the day.
Italy’s Treasury sold EUR9 billion of six-month bills, at an average yield of 3.25%, down from a record-high 6.50% in a previous auction in November. The country also sold EUR1.73 of two-year zero-coupons at a 5% yield.
Following the auction, the yield on Italy’s 10-year bonds traded at 6.76%, falling below the 7% threshold widely seen as unsustainable in the long-term.
The response to the auction was viewed as a gauge of whether last week’s cash infusion by the European Central Bank had been effective.
Despite the upbeat results, Thursday’s sale of EUR8.5 billion of long-term Italian debt maturing between 2014 and 2022 was seen as a bigger test of market confidence in the country’s sovereign debt.
Elsewhere, the euro was fractionally lower against the pound with EUR/GBP inching down 0.02%, to trade at 0.8338.
No major economic data was due for release Wednesday.
EUR/USD hit 1.3057 during European afternoon trade, the daily low; the pair subsequently consolidated at 1.3068, easing 0.02%.
The pair was likely to find support at 1.3016, the low of December 22 and resistance at 1.3131, the high of December 20.
With most investors already away on year-end leave, trading volumes were thin, resulting in tight liquidity conditions and irregular volatility.
The euro found support after a stronger-than-expected auction of Italian government debt earlier in the day.
Italy’s Treasury sold EUR9 billion of six-month bills, at an average yield of 3.25%, down from a record-high 6.50% in a previous auction in November. The country also sold EUR1.73 of two-year zero-coupons at a 5% yield.
Following the auction, the yield on Italy’s 10-year bonds traded at 6.76%, falling below the 7% threshold widely seen as unsustainable in the long-term.
The response to the auction was viewed as a gauge of whether last week’s cash infusion by the European Central Bank had been effective.
Despite the upbeat results, Thursday’s sale of EUR8.5 billion of long-term Italian debt maturing between 2014 and 2022 was seen as a bigger test of market confidence in the country’s sovereign debt.
Elsewhere, the euro was fractionally lower against the pound with EUR/GBP inching down 0.02%, to trade at 0.8338.
No major economic data was due for release Wednesday.