Investing.com - The euro remained slightly lower against the U.S. dollar on Wednesday, after a liquidity boosting operation by the European Central Bank bolstered demand for higher-yielding assets at the expense of the single currency and after Finland endorsed a second bailout for Greece.
EUR/USD hit 1.3423 during European early afternoon trade, the session low; the pair subsequently consolidated at 1.3447, dipping 0.07%.
The pair was likely to find support at 1.3388, Tuesday’s low and resistance at 1.3485, the session high and a 12-week high.
The ECB said that it had allotted EUR529 billion in three-year loans to European lenders, after receiving bids from 800 banks, significantly more than in the bank’s first long term refinancing operation late last year.
In December, the EBC issued EUR489 billion in three-year loans to 523 banks, averting a liquidity shortage in the euro zone’s banking system and easing pressure on the region’s bond markets.
The injection of liquidity was expected to support demand for riskier assets but the increased demand sparked concerns that banks in the region expect liquidity pressures to continue.
Elsewhere, Finland’s parliament approved Greece’s second bailout package, one day after Germany’s parliament approved the bailout by a comfortable margin.
Also Wednesday, official data showed that consumer price inflation in the euro zone eased unexpectedly in January, rising by a seasonally adjusted 2.6%, down from a preliminary estimate of 2.7%.
Analysts had expected euro zone consumer prices to remain unchanged.
The euro was lower against the pound and the yen, with EUR/GBP shedding 0.41% to hit 0.8428 and EUR/JPY slipping 0.08% to hit 108.19.
Later in the day, the U.S. was to release a preliminary report on fourth-quarter gross domestic product, while Federal Reserve Chairman Ben Bernanke was due to testify on the semi-annual monetary policy report before the House Financial Services Committee in Washington.
EUR/USD hit 1.3423 during European early afternoon trade, the session low; the pair subsequently consolidated at 1.3447, dipping 0.07%.
The pair was likely to find support at 1.3388, Tuesday’s low and resistance at 1.3485, the session high and a 12-week high.
The ECB said that it had allotted EUR529 billion in three-year loans to European lenders, after receiving bids from 800 banks, significantly more than in the bank’s first long term refinancing operation late last year.
In December, the EBC issued EUR489 billion in three-year loans to 523 banks, averting a liquidity shortage in the euro zone’s banking system and easing pressure on the region’s bond markets.
The injection of liquidity was expected to support demand for riskier assets but the increased demand sparked concerns that banks in the region expect liquidity pressures to continue.
Elsewhere, Finland’s parliament approved Greece’s second bailout package, one day after Germany’s parliament approved the bailout by a comfortable margin.
Also Wednesday, official data showed that consumer price inflation in the euro zone eased unexpectedly in January, rising by a seasonally adjusted 2.6%, down from a preliminary estimate of 2.7%.
Analysts had expected euro zone consumer prices to remain unchanged.
The euro was lower against the pound and the yen, with EUR/GBP shedding 0.41% to hit 0.8428 and EUR/JPY slipping 0.08% to hit 108.19.
Later in the day, the U.S. was to release a preliminary report on fourth-quarter gross domestic product, while Federal Reserve Chairman Ben Bernanke was due to testify on the semi-annual monetary policy report before the House Financial Services Committee in Washington.