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Forex - EUR/USD slides amid renewed euro zone debt concerns

Published 08/24/2011, 02:28 AM
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Investing.com – The euro was lower against the U.S. dollar on Wednesday, as fresh concerns over the sovereign debt crisis in the single currency bloc and fears over the outlook for global growth weighed.

EUR/USD hit 1.4388 during late Asian trade, the daily low; the pair subsequently consolidated at 1.4405, shedding 0.20%.

The pair was likely to find support at 1.4258, the low of August 19 and short-term resistance at 1.4499, Tuesday’s high and a four-day high.

On Tuesday, German Chancellor Angela Merkel rejected attempts by Finland to receive collateral for fresh aid for Greece, a move that led other euro zone countries to demand similar treatment.

Also Tuesday, U.S. data showed that new home sales fell to their lowest level in five months in July and the Richmond Fed's manufacturing index tumbled in August.

The Census Bureau said that new home sales fell to a seasonally adjusted annual rate of 298K, from 312K in the preceding month. Analysts had expected new home sales to fall to 310K last month.

The euro was also lower against the pound, with EUR/GBP shedding 0.24% to hit 0.8733.

Later in the day, the euro zone was to produce official data on industrial new orders, while the Ifo Institute for Economic Research was to release a report on German business climate. Also Wednesday, the U.S. is to publish government data on durable goods orders.

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