Investing.com - The euro ended the week lower against the U.S. dollar on Friday, as fresh concerns over the economic outlook for the euro zone and weaker-than-expected U.S. consumer confidence data weighed on risk appetite.
EUR/USD hit 1.3279 on Friday, the session low; the pair subsequently consolidated at 1.3318 by close of trade, down 0.31% for the week.
The pair is likely to find support at 1.3247, the low of January 11 and resistance at 1.3403, last Monday’s high and an 11-month high.
The euro came under pressure as data indicated that the euro zone economy would struggle to recover in 2013.
The Bank of Italy said Friday that the country’s economy would contract by 1% this year. Earlier in the week, Germany’s Economy Ministry cut its forecast for growth to 0.4% in 2013, down from its previous forecast for 1% growth.
Meanwhile, data showing that China’s economy expanded more-than-forecast in the fourth quarter was overshadowed by weaker-than-forecast data on U.S. consumer confidence and U.K. retail sales.
Beijing said the world’s second largest economy expanded by 7.9% year-on-year in the three months to December, above expectations for 7.8% growth.
Safe haven demand received a boost after data showed that the University of Michigan’s U.S. consumer confidence index unexpectedly dropped from 72.9 to 71.3 in January, its lowest level since December 2011, compared to expectations for an improvement to 75.0.
Consumer sentiment was hit by ongoing concerns over the U.S. debt ceiling debate.
The euro pared losses against the dollar after U.S. Republicans said Friday that they would hold a vote next week to grant a three-month debt limit extension to give Congress time to pass a Federal budget.
Elsewhere, the euro was trading close to 10-month highs against the weaker pound, with EUR/GBP settling at 0.8385 and was hovering near 20-month peaks against the struggling yen, with EUR/JPY settling at 119.90. The single currency pulled back from its highest level since May 2011 against the Swiss franc on Friday, with EUR/CHF down 0.27% to settle at 1.2439.
In the week ahead, investors will be closely watching Tuesday’s ZEW report on German economic sentiment amid concerns over the outlook for the euro zone’s largest economy. The U.S. is to publish data on the housing sector.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, January 21
In the euro zone, the euro group of finance ministers is to hold talks on a range of financial issues in Brussels. Meanwhile, Germany is to release official data on producer price inflation.
Markets in the U.S. are to remain closed on Monday for Martin Luther King Day.
Tuesday, January 22
The euro group of finance ministers is to hold a second day of talks in Brussels. Elsewhere in the euro zone, the ZEW Institute is to release its closely watched index of German economic sentiment, a leading indicator of economic health.
The U.S. is to publish private sector data on existing home sales, a leading indicator of economic health.
Also Tuesday, the World Economic Forum is to begin its annual meeting in Davos, Switzerland.
Wednesday, January 23
The U.S. is to release government data on crude oil stockpiles.
The World Economic Forum is to continue for a second day in Davos, Switzerland.
Thursday, January 24
The euro zone is to produce official data on the current account and preliminary data on manufacturing and service sector activity, while Germany and France are also to release individual reports. In addition Spain is to publish official data on the unemployment rate.
The U.S. is to publish the weekly government report on initial jobless claims, as well as preliminary data on manufacturing activity.
The World Economic Forum is to continue for a third day in Davos, Switzerland.
Friday, January 25
In the euro zone, the Ifo Institute is to publish a report on German business climate, a leading indicator of economic health.
The U.S. is to round up the week with government data on new homes sales, a leading indicator of economic health.
The World Economic Forum is to continue for a fourth day in Davos, Switzerland.
EUR/USD hit 1.3279 on Friday, the session low; the pair subsequently consolidated at 1.3318 by close of trade, down 0.31% for the week.
The pair is likely to find support at 1.3247, the low of January 11 and resistance at 1.3403, last Monday’s high and an 11-month high.
The euro came under pressure as data indicated that the euro zone economy would struggle to recover in 2013.
The Bank of Italy said Friday that the country’s economy would contract by 1% this year. Earlier in the week, Germany’s Economy Ministry cut its forecast for growth to 0.4% in 2013, down from its previous forecast for 1% growth.
Meanwhile, data showing that China’s economy expanded more-than-forecast in the fourth quarter was overshadowed by weaker-than-forecast data on U.S. consumer confidence and U.K. retail sales.
Beijing said the world’s second largest economy expanded by 7.9% year-on-year in the three months to December, above expectations for 7.8% growth.
Safe haven demand received a boost after data showed that the University of Michigan’s U.S. consumer confidence index unexpectedly dropped from 72.9 to 71.3 in January, its lowest level since December 2011, compared to expectations for an improvement to 75.0.
Consumer sentiment was hit by ongoing concerns over the U.S. debt ceiling debate.
The euro pared losses against the dollar after U.S. Republicans said Friday that they would hold a vote next week to grant a three-month debt limit extension to give Congress time to pass a Federal budget.
Elsewhere, the euro was trading close to 10-month highs against the weaker pound, with EUR/GBP settling at 0.8385 and was hovering near 20-month peaks against the struggling yen, with EUR/JPY settling at 119.90. The single currency pulled back from its highest level since May 2011 against the Swiss franc on Friday, with EUR/CHF down 0.27% to settle at 1.2439.
In the week ahead, investors will be closely watching Tuesday’s ZEW report on German economic sentiment amid concerns over the outlook for the euro zone’s largest economy. The U.S. is to publish data on the housing sector.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, January 21
In the euro zone, the euro group of finance ministers is to hold talks on a range of financial issues in Brussels. Meanwhile, Germany is to release official data on producer price inflation.
Markets in the U.S. are to remain closed on Monday for Martin Luther King Day.
Tuesday, January 22
The euro group of finance ministers is to hold a second day of talks in Brussels. Elsewhere in the euro zone, the ZEW Institute is to release its closely watched index of German economic sentiment, a leading indicator of economic health.
The U.S. is to publish private sector data on existing home sales, a leading indicator of economic health.
Also Tuesday, the World Economic Forum is to begin its annual meeting in Davos, Switzerland.
Wednesday, January 23
The U.S. is to release government data on crude oil stockpiles.
The World Economic Forum is to continue for a second day in Davos, Switzerland.
Thursday, January 24
The euro zone is to produce official data on the current account and preliminary data on manufacturing and service sector activity, while Germany and France are also to release individual reports. In addition Spain is to publish official data on the unemployment rate.
The U.S. is to publish the weekly government report on initial jobless claims, as well as preliminary data on manufacturing activity.
The World Economic Forum is to continue for a third day in Davos, Switzerland.
Friday, January 25
In the euro zone, the Ifo Institute is to publish a report on German business climate, a leading indicator of economic health.
The U.S. is to round up the week with government data on new homes sales, a leading indicator of economic health.
The World Economic Forum is to continue for a fourth day in Davos, Switzerland.