Investing.com - The euro ended the week higher against the U.S. dollar on Friday, as new hopes of progress in tackling the region’s debt crisis supported market sentiment while downbeat U.S. new home sales data weighed on the greenback.
EUR/USD hit 1.3292 on Friday, the pair’s highest since March 2; the pair subsequently consolidated at 1.3268 by close of trade on Friday, adding 0.64% over the week.
The pair was likely to find support at 1.3171, the low of March 20 and resistance at 1.3355, the high of March 1.
The single currency found support on Friday after euro zone finance ministers said they are moving closer to agreeing on a combined rescue fund of around EUR700 billion next week.
Meanwhile, the U.S. dollar weakened after the U.S. Commerce Department said new home sales dropped 1.6% to a 313,000 annual pace, the slowest since October, from a 318,000 annual rate in January and against expectations for an increase to 325,000.
The greenback remained supported, however, after the Federal Reserve upgraded its view on the economy earlier this month, leading investors to trim back expectations for a third round of monetary easing from the central bank.
The U.S. outlook was also boosted by data Thursday showing that jobless claims fell to the lowest level since February 2008 last week.
The Department of Labor said the number of individuals filing for initial jobless benefits in the week ending March 17 fell by 5,000 to a seasonally adjusted 348,000, beating expectations for a decline of 3,000 to 350,000.
The previous week’s figure was revised up to 353,000 from 351,000.
The euro fell to a four-day low against the dollar on Thursday as the outlook for growth in the single currency bloc remained clouded after data showed that manufacturing activity slumped unexpectedly in March, remaining in contraction territory for the eighth consecutive month, while service sector activity declined to the lowest level in four months in March.
The data came after a report showed that industrial new orders in the euro zone tumbled by a seasonally adjusted 2.3% in January, compared to expectations for a 2.1% drop.
Sentiment was also hit after a report showed that Chinese manufacturing activity contracted for a fifth consecutive month, underlining concerns over a possible slowdown in growth in the world’s second largest economy.
In the week ahead, market participants will be looking ahead to Friday’s meeting of euro zone finance ministers to discuss the lending capacity of the region’s permanent bailout fund, the European Financial Stability Facility.
Meanwhile, the U.S. is to release data on consumer confidence, pending homes sales, and factory output, all of which will be closely watched in order to gauge the strength of the U.S. economic recovery.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, March 26
In the euro zone, the Ifo Institute for Economic Research is publish a report on German business climate, a leading indicator of economic health, while European Central Bank President Mario Draghi is due to speak later in the day.
Elsewhere, Federal Reserve Chairman Ben Bernanke is scheduled to speak at the National Association for Business Economists 2012 Policy Conference. The U.S. is also to publish industry data on pending home sales, a key gauge of economic health.
Tuesday, March 27
In the euro zone, a Gfk report is to be published on German consumer climate, an important indicator of consumer spending.
The U.S. is to produce a Standard & Poor’s/Case Shiller composite-20 house price inflation report, as well as industry data on consumer confidence.
Later in the day, Fed Chairman Bernanke is due to deliver the third part of a lecture titled "The Federal Reserve and its Role in Today's Economy" at the George Washington University School of Business, in Washington.
Wednesday, March 28
In the euro zone, Germany is to release preliminary data on consumer price inflation, which accounts for a majority of overall inflation. The ECB is also to release data on money supply.
The U.S. is to publish government data on durable goods orders, a leading indicator of production, followed by a report on crude oil stockpiles.
Thursday, March 29
In the euro zone, official data is to be published on German unemployment change, an important signal of overall economic health.
Later Thursday, the U.S. is to publish government data on unemployment claims, a key signal of overall economic health, as well as final data on fourth quarter GDP. Fed Chairman Bernanke is also due to speak.
Friday, March 30
In the euro zone, official data is to be produced on German retail sales and on French consumer spending, followed by a preliminary report on consumer price inflation throughout the single currency bloc.
The U.S. is to round up the week with government data on personal consumption expenditures and personal spending as well as industry data on the purchasing managers’ index in Chicago. In addition, the University of Michigan is to release revised data on consumer sentiment.
EUR/USD hit 1.3292 on Friday, the pair’s highest since March 2; the pair subsequently consolidated at 1.3268 by close of trade on Friday, adding 0.64% over the week.
The pair was likely to find support at 1.3171, the low of March 20 and resistance at 1.3355, the high of March 1.
The single currency found support on Friday after euro zone finance ministers said they are moving closer to agreeing on a combined rescue fund of around EUR700 billion next week.
Meanwhile, the U.S. dollar weakened after the U.S. Commerce Department said new home sales dropped 1.6% to a 313,000 annual pace, the slowest since October, from a 318,000 annual rate in January and against expectations for an increase to 325,000.
The greenback remained supported, however, after the Federal Reserve upgraded its view on the economy earlier this month, leading investors to trim back expectations for a third round of monetary easing from the central bank.
The U.S. outlook was also boosted by data Thursday showing that jobless claims fell to the lowest level since February 2008 last week.
The Department of Labor said the number of individuals filing for initial jobless benefits in the week ending March 17 fell by 5,000 to a seasonally adjusted 348,000, beating expectations for a decline of 3,000 to 350,000.
The previous week’s figure was revised up to 353,000 from 351,000.
The euro fell to a four-day low against the dollar on Thursday as the outlook for growth in the single currency bloc remained clouded after data showed that manufacturing activity slumped unexpectedly in March, remaining in contraction territory for the eighth consecutive month, while service sector activity declined to the lowest level in four months in March.
The data came after a report showed that industrial new orders in the euro zone tumbled by a seasonally adjusted 2.3% in January, compared to expectations for a 2.1% drop.
Sentiment was also hit after a report showed that Chinese manufacturing activity contracted for a fifth consecutive month, underlining concerns over a possible slowdown in growth in the world’s second largest economy.
In the week ahead, market participants will be looking ahead to Friday’s meeting of euro zone finance ministers to discuss the lending capacity of the region’s permanent bailout fund, the European Financial Stability Facility.
Meanwhile, the U.S. is to release data on consumer confidence, pending homes sales, and factory output, all of which will be closely watched in order to gauge the strength of the U.S. economic recovery.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, March 26
In the euro zone, the Ifo Institute for Economic Research is publish a report on German business climate, a leading indicator of economic health, while European Central Bank President Mario Draghi is due to speak later in the day.
Elsewhere, Federal Reserve Chairman Ben Bernanke is scheduled to speak at the National Association for Business Economists 2012 Policy Conference. The U.S. is also to publish industry data on pending home sales, a key gauge of economic health.
Tuesday, March 27
In the euro zone, a Gfk report is to be published on German consumer climate, an important indicator of consumer spending.
The U.S. is to produce a Standard & Poor’s/Case Shiller composite-20 house price inflation report, as well as industry data on consumer confidence.
Later in the day, Fed Chairman Bernanke is due to deliver the third part of a lecture titled "The Federal Reserve and its Role in Today's Economy" at the George Washington University School of Business, in Washington.
Wednesday, March 28
In the euro zone, Germany is to release preliminary data on consumer price inflation, which accounts for a majority of overall inflation. The ECB is also to release data on money supply.
The U.S. is to publish government data on durable goods orders, a leading indicator of production, followed by a report on crude oil stockpiles.
Thursday, March 29
In the euro zone, official data is to be published on German unemployment change, an important signal of overall economic health.
Later Thursday, the U.S. is to publish government data on unemployment claims, a key signal of overall economic health, as well as final data on fourth quarter GDP. Fed Chairman Bernanke is also due to speak.
Friday, March 30
In the euro zone, official data is to be produced on German retail sales and on French consumer spending, followed by a preliminary report on consumer price inflation throughout the single currency bloc.
The U.S. is to round up the week with government data on personal consumption expenditures and personal spending as well as industry data on the purchasing managers’ index in Chicago. In addition, the University of Michigan is to release revised data on consumer sentiment.