Investing.com - The euro hit a two-month low against the broadly stronger U.S. dollar on Friday amid concerns that the economic slump in the euro zone is worsening, while concerns over U.S. fiscal policy also weighed.
EUR/USD hit 1.2689 on Friday, the pair’s lowest since September 7; the pair subsequently consolidated at 1.2709 by close of trade, down 0.82% for the week.
The pair is likely to find support at 1.2625, the low of September 7 and resistance at 1.2789, Friday’s high.
The euro weakened broadly after Germany’s Economic Ministry warned Friday that economic growth was likely to weaken in the fourth quarter and going into the first quarter of 2013, underlining fears over a slowdown in the bloc’s largest economy.
Elsewhere, official data showed that industrial production in France fell in October and the country’s central bank said it expected the economy to enter a recession by the end of this year.
Market participants were anticipating a Greek vote on the 2013 budget on Sunday; just days after the country’s parliament narrowly approved a new austerity package needed to secure the next tranche of bailout funds.
Without the next aid installment, Greece risks default on November 16, when Athens must repay EUR5 billion of debts.
Eurozone finance ministers are to meet in Brussels on Monday, although they are not expected to approve releasing the latest aid tranche to Greece.
Meanwhile, uncertainty over whether Spain will request a bailout continued to cloud the outlook for the euro after a successful Spanish bond auction on Thursday eased pressure on Prime Minister Mariano Rajoy to seek aid before the end of this year.
Speaking at the European Central Bank's post-policy meeting press conference on Thursday, President Mario Draghi said the bank expected growth to continue to be weak both for the remainder of this year and in 2013.
The ECB kept interest rates unchanged at a record-low 0.75% on Thursday, in line with market expectations.
Safe haven demand for the dollar was underpinned by concerns over the U.S. fiscal cliff, automatic tax hikes and spending cuts due to come into effect on January 1 unless lawmakers can reach an agreement, which could threaten U.S. and global growth.
In the coming week, investors will be anticipating preliminary data on third quarter growth from the euro zone, amid concerns that the economic downturn in the region is deepening. Markets will also be closely following developments in Greece and Spain.
In addition, the Federal Reserve is to publish the minutes of its last policy setting meeting.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, November 12
In the euro zone, the eurogroup of finance ministers is to hold talks in Brussels to discuss financial issues in the bloc.
Markets in the U.S. are to remain closed on Monday for a national holiday.
Tuesday, November 13
In the euro zone, the eurogroup of finance ministers is to hold a second day of talks to discuss financial issues in the bloc. In addition, the ZEW Centre for Economic Research is to release its closely watched report on German economic sentiment, as well as data on sentiment in the wider euro zone.
The U.S. is to release official data on the federal budget balance.
Wednesday, November 14
The euro zone is to release official data on industrial production, a leading indicator of economic health.
The U.S. is to produce government data on retail sales, producer price inflation and business inventories. In addition, the Federal Reserve is to publish the minutes of its most recent policy-setting meeting.
Thursday, November 15
The euro zone is to produce official data on consumer price inflation, as well as preliminary data on third quarter GDP. France, Germany and Italy are also to release individual GDP reports. Meanwhile, the European Central Bank is to publish its monthly bulletin, which looks at economic conditions from the bank’s perspective.
The U.S. is to release a flurry of data, with reports on initial jobless claims, consumer price inflation, crude oil stockpiles, in addition to data on manufacturing activity in New York and Philadelphia.
Meanwhile, a speech by Federal Reserve Chairman Ben Bernanke would be closely watched for any indications on the future possible direction of monetary policy.
Friday, November 16
The euro zone is to release official data on the current account, which is closely linked to currency demand.
The U.S. is to round up the week with official data on the capacity utilization rate and industrial production, as well as a report on the balance of domestic and foreign securities purchases.
EUR/USD hit 1.2689 on Friday, the pair’s lowest since September 7; the pair subsequently consolidated at 1.2709 by close of trade, down 0.82% for the week.
The pair is likely to find support at 1.2625, the low of September 7 and resistance at 1.2789, Friday’s high.
The euro weakened broadly after Germany’s Economic Ministry warned Friday that economic growth was likely to weaken in the fourth quarter and going into the first quarter of 2013, underlining fears over a slowdown in the bloc’s largest economy.
Elsewhere, official data showed that industrial production in France fell in October and the country’s central bank said it expected the economy to enter a recession by the end of this year.
Market participants were anticipating a Greek vote on the 2013 budget on Sunday; just days after the country’s parliament narrowly approved a new austerity package needed to secure the next tranche of bailout funds.
Without the next aid installment, Greece risks default on November 16, when Athens must repay EUR5 billion of debts.
Eurozone finance ministers are to meet in Brussels on Monday, although they are not expected to approve releasing the latest aid tranche to Greece.
Meanwhile, uncertainty over whether Spain will request a bailout continued to cloud the outlook for the euro after a successful Spanish bond auction on Thursday eased pressure on Prime Minister Mariano Rajoy to seek aid before the end of this year.
Speaking at the European Central Bank's post-policy meeting press conference on Thursday, President Mario Draghi said the bank expected growth to continue to be weak both for the remainder of this year and in 2013.
The ECB kept interest rates unchanged at a record-low 0.75% on Thursday, in line with market expectations.
Safe haven demand for the dollar was underpinned by concerns over the U.S. fiscal cliff, automatic tax hikes and spending cuts due to come into effect on January 1 unless lawmakers can reach an agreement, which could threaten U.S. and global growth.
In the coming week, investors will be anticipating preliminary data on third quarter growth from the euro zone, amid concerns that the economic downturn in the region is deepening. Markets will also be closely following developments in Greece and Spain.
In addition, the Federal Reserve is to publish the minutes of its last policy setting meeting.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, November 12
In the euro zone, the eurogroup of finance ministers is to hold talks in Brussels to discuss financial issues in the bloc.
Markets in the U.S. are to remain closed on Monday for a national holiday.
Tuesday, November 13
In the euro zone, the eurogroup of finance ministers is to hold a second day of talks to discuss financial issues in the bloc. In addition, the ZEW Centre for Economic Research is to release its closely watched report on German economic sentiment, as well as data on sentiment in the wider euro zone.
The U.S. is to release official data on the federal budget balance.
Wednesday, November 14
The euro zone is to release official data on industrial production, a leading indicator of economic health.
The U.S. is to produce government data on retail sales, producer price inflation and business inventories. In addition, the Federal Reserve is to publish the minutes of its most recent policy-setting meeting.
Thursday, November 15
The euro zone is to produce official data on consumer price inflation, as well as preliminary data on third quarter GDP. France, Germany and Italy are also to release individual GDP reports. Meanwhile, the European Central Bank is to publish its monthly bulletin, which looks at economic conditions from the bank’s perspective.
The U.S. is to release a flurry of data, with reports on initial jobless claims, consumer price inflation, crude oil stockpiles, in addition to data on manufacturing activity in New York and Philadelphia.
Meanwhile, a speech by Federal Reserve Chairman Ben Bernanke would be closely watched for any indications on the future possible direction of monetary policy.
Friday, November 16
The euro zone is to release official data on the current account, which is closely linked to currency demand.
The U.S. is to round up the week with official data on the capacity utilization rate and industrial production, as well as a report on the balance of domestic and foreign securities purchases.