Investing.com - The euro shot up against a tanking dollar on Wednesday after U.S. retails sales and wholesale pricing numbers came in short of expectations and cast doubts as to the strength of U.S. recovery.
In U.S. trading, EUR/USD was up 1.06% at 1.2791, up from a session low of 1.2625 and off a high of 1.2883.
The pair was likely to find support at 1.2604, last Friday's low, and resistance at 1.2903, the high from Sept. 23.
The Census Bureau reported earlier that U.S. retail sales fell 0.3% last month, exceeding forecasts for a 0.1% decline, after expanding 0.6% in August.
Core retail sales, which exclude motor vehicles and parts, dropped 0.2% in September, defying expectations for a 0.3% gain, after rising 0.3% the previous month.
A separate report showed that U.S. producer price inflation slipped 0.1% in September, disappointing expectations for a 0.1% rise, after a flat reading in August.
September's year-on-year PPI rose 1.6%, missing expectations for a 1.8% gain.
Elsewhere, the Federal Reserve of New York reported that its manufacturing index tumbled to a six-month low of 6.2 in October from 27.5 in September. Analysts had expected the index to tick down to 25.5 this month.
Wednesday's data sent investors rethinking how fast the Federal Reserve will move to tighten policy in 2015, which battered the dollar and gave investors room to overlook Tuesday's soft data out of Europe.
The ZEW Centre for Economic Research reported Tuesday that its German economic sentiment index fell to -3.6 this month from September’s 6.9 reading. Analysts had expected the index to come in at 1.0 in October.
The index of euro zone economic sentiment plunged to 4.1 in September from 14.2 in August, well below expectations for a decline to 7.1.
A separate report showed that euro zone industrial production contracted 1.8% in August from July, outpacing expectations for a 1.6% decline. July's figure was revised to a 0.9% rise from a previously estimated 1.0% increase.
Year-on-year, industrial production fell 1.9% in August, surpassing expectations for a 0.9% decline and after rising at a rate of 1.6% the previous month.
Elsewhere, the euro was up against the pound, with EUR/GBP up 0.63% at 0.8010, and up against the yen, with EUR/JPY up 0.04% at 135.56.
On Wednesday, the euro zone is to publish revised data on consumer prices for September.
The U.S. is to release the weekly report on initial jobless claims as well as data on industrial production and manufacturing activity in the Philadelphia region.