Investing.com - The euro pulled away from two-month lows against the dollar in holiday-thinned trade on Monday, but gains were held in check as concerns over the economic outlook for the euro zone weighed.
EUR/USD fell to lows of 1.3508, the weakest since November 25, before regaining ground, and was last up 0.16% to 1.3560.
The pair is likely to find support at 1.3500 and resistance at 1.3620, Friday’s high.
The common currency remained under pressure amid concerns that the subdued inflation outlook for the euro zone may prompt the European Central Bank to ease monetary policy further in order to safeguard the fragile recovery in the region.
The euro found some support after data on Monday showed that China’s economy grew 7.7% on a year-over-year basis in the fourth quarter, slowing from 7.8% in the previous quarter, but still above the 7.6% forecast by economists.
Demand for the dollar continued to be underpinned after recent U.S. economic data added to the view that the recovery is strong enough for the Federal Reserve to make further reductions to its asset purchase program at its upcoming policy meeting later this month.
Trade volumes remained thin on Monday, with markets in the U.S. closed for a holiday.
Elsewhere, the euro was trading close to one-year lows against the pound. EUR/USD touched lows of 0.8233, and was last up 0.12% to 0.8255, near the 12-month low of 0.8229 struck on January 9.
THe euro was near one-and-a-half month lows against the yen. EUR/JPY hit lows of 140.33, the weakest since December 6 and was last down 0.15% to 141.02.