Investing.com - The euro ended the week lower against the U.S. dollar on Friday, after expectations for fresh easing measures by the Federal Reserve were dampened by positive U.S. employment data.
EUR/USD hit 1.3095 on Friday, the pair’s lowest since February 16; the pair subsequently consolidated at 1.3121, shedding 0.52% over the week.
The pair is likely to find support at 1.3027, the low of February 6 and resistance at 1.3290, the high of March 8.
The Department of Labor said on Friday that the U.S. economy added 227,000 jobs in February after increasing by a revised 284,000 the previous month. The unemployment rate held steady at a three year low of 8.3%.
The strong data boosted the dollar as it diminished expectations for a fresh round of asset purchases by the Federal Reserve to help stimulate economic growth.
A separate report showed that the U.S. trade deficit widened unexpectedly in January, falling to USD52.6 billion from a deficit of USD50.4 billion the previous month.
Analysts had expected the trade deficit to narrow to USD48.9 billion in January.
Earlier Friday, Greece announced that more than 85% of its private creditors had signed up to a debt swap deal, aimed at restructuring 53.5% of the country’s debt. The deal cleared the way for Athens to secure a second bailout worth EUR130 billion and avert a default.
But sentiment on the euro weakened after the International Swaps and Derivatives Association said the debt swap constituted a “credit event” that would activate credit-default swaps, which designed to protect investors against losses on Greek sovereign debt.
The single currency was also weighed by concerns over the economic outlook for the region after the European Central Bank revised down its forecast for growth in 2012 to a range of between minus 0.5% and 0.3% following Thursday’s policy meeting.
The central bank left its benchmark interest rate unchanged at 1% for the third consecutive month, in a widely expected decision.
The euro rose to a four-day high against the greenback on Thursday after data showed that German industrial production rebounded in January after a steep drop the previous month, climbing 1.6% and surpassing expectations for a 1.1% increase.
Earlier in the week, market sentiment was also dented by fears that the euro zone is slipping into a recession after data confirmed that the region’s economy contracted by 0.3% in the last three months of 2011, as household spending, exports and imports all fell.
In the week ahead, investors will be continuing to watch developments in Greece, with the euro likely to remain under pressure after Friday’s ISDA ruling. Investors will also be watching Tuesday’s U.S. data on retail sales in order to gage the strength of consumer spending as well as the Federal Reserve’s interest rate statement.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, March 12
The U.S. is to publish government data on the federal budget balance.
Tuesday, March 13
In the euro zone, reports are to be released on the ZEW economic sentiment index for Germany and for the entire single currency bloc. Later in the day, ECB President Mario Draghi is due to speak. Meanwhile, euro zone finance ministers are scheduled to hold talks throughout the day.
The U.S. is to release government data on retail sales, the foremost indicator of consumer spending, which accounts for the majority of overall economic activity. The country is also to produce official data on business inventories, a signal of future business spending.
Also Tuesday, the Federal Reserve is to announce its benchmark interest rate; the announcement will be accompanied by the central bank’s rate statement.
Wednesday, March 14
The euro zone is to publish official data on consumer price inflation, which accounts for the majority of overall inflation, as well as data on industrial production, a leading indicator of economic health.
Later in the day, the U.S. is to produce official data on the country’s current account, as well as data on import prices and crude oil stockpiles. In addition, Federal Reserve Chairman Ben Bernanke is also due to speak; his comments will be closely watched for clues to the future possible direction of monetary policy.
Thursday, March 15
The ECB is to publish its monthly bulletin, which reveals the statistical data that the bank’s Governing Board evaluated when making the latest interest rate decision.
Later Thursday, the U.S. is to release government data on producer price inflation, a leading indicator of consumer inflation, as well as official data on unemployment claims. The country is also to produce reports on manufacturing activity in New York and Philadelphia, as well as a government report on net long-term securities transactions.
Friday, March 16
The U.S. is to round up the week with government data on consumer price inflation, followed by reports from the Federal Reserve on the capacity utilization rate and industrial production. In addition, the country is also to release preliminary reports by the University of Michigan on consumer sentiment and inflation expectations.
EUR/USD hit 1.3095 on Friday, the pair’s lowest since February 16; the pair subsequently consolidated at 1.3121, shedding 0.52% over the week.
The pair is likely to find support at 1.3027, the low of February 6 and resistance at 1.3290, the high of March 8.
The Department of Labor said on Friday that the U.S. economy added 227,000 jobs in February after increasing by a revised 284,000 the previous month. The unemployment rate held steady at a three year low of 8.3%.
The strong data boosted the dollar as it diminished expectations for a fresh round of asset purchases by the Federal Reserve to help stimulate economic growth.
A separate report showed that the U.S. trade deficit widened unexpectedly in January, falling to USD52.6 billion from a deficit of USD50.4 billion the previous month.
Analysts had expected the trade deficit to narrow to USD48.9 billion in January.
Earlier Friday, Greece announced that more than 85% of its private creditors had signed up to a debt swap deal, aimed at restructuring 53.5% of the country’s debt. The deal cleared the way for Athens to secure a second bailout worth EUR130 billion and avert a default.
But sentiment on the euro weakened after the International Swaps and Derivatives Association said the debt swap constituted a “credit event” that would activate credit-default swaps, which designed to protect investors against losses on Greek sovereign debt.
The single currency was also weighed by concerns over the economic outlook for the region after the European Central Bank revised down its forecast for growth in 2012 to a range of between minus 0.5% and 0.3% following Thursday’s policy meeting.
The central bank left its benchmark interest rate unchanged at 1% for the third consecutive month, in a widely expected decision.
The euro rose to a four-day high against the greenback on Thursday after data showed that German industrial production rebounded in January after a steep drop the previous month, climbing 1.6% and surpassing expectations for a 1.1% increase.
Earlier in the week, market sentiment was also dented by fears that the euro zone is slipping into a recession after data confirmed that the region’s economy contracted by 0.3% in the last three months of 2011, as household spending, exports and imports all fell.
In the week ahead, investors will be continuing to watch developments in Greece, with the euro likely to remain under pressure after Friday’s ISDA ruling. Investors will also be watching Tuesday’s U.S. data on retail sales in order to gage the strength of consumer spending as well as the Federal Reserve’s interest rate statement.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, March 12
The U.S. is to publish government data on the federal budget balance.
Tuesday, March 13
In the euro zone, reports are to be released on the ZEW economic sentiment index for Germany and for the entire single currency bloc. Later in the day, ECB President Mario Draghi is due to speak. Meanwhile, euro zone finance ministers are scheduled to hold talks throughout the day.
The U.S. is to release government data on retail sales, the foremost indicator of consumer spending, which accounts for the majority of overall economic activity. The country is also to produce official data on business inventories, a signal of future business spending.
Also Tuesday, the Federal Reserve is to announce its benchmark interest rate; the announcement will be accompanied by the central bank’s rate statement.
Wednesday, March 14
The euro zone is to publish official data on consumer price inflation, which accounts for the majority of overall inflation, as well as data on industrial production, a leading indicator of economic health.
Later in the day, the U.S. is to produce official data on the country’s current account, as well as data on import prices and crude oil stockpiles. In addition, Federal Reserve Chairman Ben Bernanke is also due to speak; his comments will be closely watched for clues to the future possible direction of monetary policy.
Thursday, March 15
The ECB is to publish its monthly bulletin, which reveals the statistical data that the bank’s Governing Board evaluated when making the latest interest rate decision.
Later Thursday, the U.S. is to release government data on producer price inflation, a leading indicator of consumer inflation, as well as official data on unemployment claims. The country is also to produce reports on manufacturing activity in New York and Philadelphia, as well as a government report on net long-term securities transactions.
Friday, March 16
The U.S. is to round up the week with government data on consumer price inflation, followed by reports from the Federal Reserve on the capacity utilization rate and industrial production. In addition, the country is also to release preliminary reports by the University of Michigan on consumer sentiment and inflation expectations.