Forex - EUR/USD slips as euro zone talks continue

Published 08/24/2012, 04:31 AM
Updated 08/24/2012, 04:32 AM
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Investing.com - The euro slipped against the U.S. dollar on Friday, still trading close to a seven-week high, as investors remained cautious amid ongoing euro zone meetings following Thursday's weak economic data, while the possibility for imminent easing measures by the Federal Reserve remained uncertain.

EUR/USD hit 1.2528 during European morning trade, the daily low; the pair subsequently consolidated at 1.2531, falling 0.27%.

The pair was likely to find support at 1.2432, the low of August 22 and resistance at 1.2607, the high of July 4.

Investors eyed ongoing talks in the euro zone, after German Chancellor Angela Merkel said earlier that she and French President Francois Hollande will maintain the pressure on Greece to overhaul its economy at meetings with Prime Minister Antonis Samaras in Berlin, later Friday and on Saturday.

Only hours before talks with Samaras, the parliamentary leader of Angela Merkel's ruling conservatives sparked fresh concerns however, by saying that neither the time nor the content of Greece's rescue package can be renegotiated.

The comments came a day after data showed that manufacturing activity in the euro zone rose more-than-expected in August, but remained in contraction territory for the 12th consecutive month, while service sector activity slumped to a two-month low.

Separately, a report showing that manufacturing activity in China slumped to a nine-month low in August added to concerns over a global economic slowdown.

Meanwhile, market participants eyed the release of U.S. economic data later in the day, as reports on Thursday painted a mixed picture of the country's economic recovery, prompting investors to temper expectations for a third round of quantitative easing by the U.S. central bank to boost growth.

Elsewhere, the euro was fractionally lower against the pound, with EUR/GBP inching down 0.08% to hit 0.7916.

Later in the day, the U.S. was to release government data on durable goods orders.


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