Forex - EUR/USD trims gains after disappointing U.S. data

Published 09/14/2011, 09:58 AM
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Investing.com – The euro trimmed gains against the U.S. dollar on Wednesday, pulling back from a three-day high after reports showing that U.S. retail sales and producer prices were flat in August.

EUR/USD pulled away from 1.3747, the pair’s highest since last Friday, to hit 1.3694 during U.S. morning trade, up 0.12% on the day.

The pair was likely to find support at 1.3557, Tuesday’s low and an almost seven-month low and short-term resistance at 1.3738, Tuesday’s high.

The Commerce Department said U.S. retail sales were flat in August, disappointing expectations for a 0.2% gain. July’s figure was revised down to a 0.3% gain from a previously reported 0.5% increase.

A separate report from the Department of Labor showed U.S. producer prices were unchanged in August, as lower oil prices offset rising food costs.

The euro found support earlier as concerns over the debt crisis in the region eased after European Commission President Jose Manuel Barroso said it would soon present options for the introduction of euro area bonds.

However, he warned that the measure alone would not be enough to end the region’s debt crisis and reiterated that Germany remained strongly opposed to the move.

The euro was also higher against the pound, with EUR/GBP rising 0.16% to hit 0.8682.

Later in the day, Greek Prime Minister George Papandreou was expected to hold a conference call with German Chancellor Angela Merkel and French President Nicolas Sarkozy, to discuss developments in Greece.

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