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Forex - EUR/USD slides lower, eyes on Greece

Published 03/30/2015, 05:30 AM
© Reuters.  Euro falls against stronger dollar with Greece in focus
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Investing.com - The euro slid lower against the U.S. dollar on Monday, as Friday's strong U.S. economic growth report and comments by Federal Reserve Chair Janet Yellen continued to lend broad support to the greenback, while markets followed developments on the Greek debt front.

EUR/USD hit 1.0820 during European morning trade, the session low; the pair subsequently consolidated at 1.0853, shedding 0.34%.

The pair was likely to find support at 1.0765, the low of March 23 and resistance at 1.1052, the high of March 26.

The dollar strengthened broadly after the Commerce Department reported Friday that the U.S. economy expanded at an annual rate of 2.2% in the fourth quarter, unchanged from the preliminary estimate and below economists’ forecasts for an upward revision to 2.4%.

In addition, Fed Chair Janet Yellen said in a speech on Friday that a rate hike may be warranted later this year, but added that weakening inflation pressures could force the Fed to delay.

Ms. Yellen said policy tightening could "speed up, slow down, pause, or even reverse course" depending on how the economy is performing.

In the euro zone, Greece remained in focus after Prime Minister Alexis Tsipras’ government put forward new reform plans for approval late Friday, as part of a bailout extension review.

Officials from the European Union, the International Monetary Fund and the European Central Bank were to examine the measures after earlier proposals were not accepted.

Earlier Monday, official data showed that consumer prices in Spain fell 0.7% this month, compared to expectations for a decline of 1.0%, after a 1.1% decline in February.

The euro was steady against the pound, with EUR/GBP at 0.7308.

In the U.K., data on Monday showed that net lending to individuals and households rose broadly in line with expectations in February, reflecting improving demand for credit.

The Bank of England said total net lending to individuals increased by ₤2.5 billion last month, meeting forecasts and up from ₤2.4 billion in January.

In another report, the central bank said U.K. mortgage approvals rose to a six-month high last month, indicating that the housing market is picking up.

Later in the day, the U.S. was to release final data on fourth quarter economic growth and the revised reading of the University of Michigan consumer sentiment index.

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