Investing.com - The euro tumbled to a seven-week low against the U.S. dollar on Friday, as growing concerns over debt contagion to core economies in the euro zone dampened demand for the single currency.
EUR/USD hit 1.3211 on Friday, the pair’s lowest since October 4; the pair subsequently consolidated at 1.3234 by close of trade on Friday, plummeting 2.04% over the week.
The pair is likely to find support at 1.3144, the low of October 4 and resistance at 1.3410, the high of November 24.
The euro dropped 1.48% against the greenback on Wednesday after Germany, the euro zone’s largest economy, missed its EUR6 billion sales target at an auction of 10-year bonds, in its least successful debt sale since the launch of the single currency.
The poorly received auction was due in some part to low bond yields but sparked concerns that the debt crisis may have started affecting the euro zone's largest economy.
Meanwhile, ratings agency Fitch warned that France could lose its triple-A credit rating if European Union leaders fail to take action to prevent the crisis from worsening.
The euro slightly recovered on Thursday after a report showed that German business confidence improved unexpectedly in November.
But investors remained jittery after German Chancellor Angel Merkel reiterated her belief that joint euro zone bonds would remove incentives for individual states to improve their fiscal discipline and rejected calls for an expanded role for the ECB in fighting the debt crisis.
The single currency extended losses against the dollar on Friday, after Italian 10-year bond yields climbed to near unsustainable levels, rising above 7% even as the European Central Bank bought bonds in the secondary market.
The rise in Italian borrowing costs came after a disappointing auction of Italian government debt and fanned fears that the debt crisis in the region is deepening.
Earlier in the week, the U.S. super-committee created to cut the country’s deficit said that it failed to reach a deal, signaling that several tax programs, including a payroll-tax holiday, risk expiring at the beginning of next year. Still, ratings agency Standard & Poor’s reaffirmed it would keep the U.S.’s credit rating at AA+ after stripping the government of its top AAA grade on August 5.
In the week ahead, investors will be eyeing an auction of Belgian government debt on Monday after ratings agency Standard & Poor's downgraded its rating on Belgium by one notch on Friday.
Meanwhile, euro zone finance ministers are to meet Wednesday to discuss details on leveraging the region's bailout fund, although a major announcement is
unlikely.
Also next week, the U.S. is to release its closely watched report on non-farm payrolls.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, November 28
In the euro zone, Germany is to produce preliminary data on consumer price inflation, which accounts for the majority of overall inflation, as well as a report on consumer climate, a leading indicator of consumer spending.
Also Monday, the U.S. is to release official data on new home sales, a leading indicator of economic health.
Tuesday, November 29
The U.S. is to release industry data on house price inflation as well as a report on consumer confidence, a leading indicator of consumer spending.
Wednesday, November 30
In the euro zone, Germany is to publish official data on retail sales and employment change while France is to publish government data on consumer spending. Meanwhile, ECB President Mario Draghi is to speak; his comments will be closely watched for any clues to the possible future direction of monetary policy.
The single currency bloc is also to produce preliminary data on consumer price inflation and the unemployment rate. In addition, finance ministers from European Union member states are to meet in Brussels to discuss the ongoing financial crisis in the region.
Later in the day, the U.S. is to release a closely watched report on non-farm payrolls compiled by payroll processing firm ADP, which leads government data by two days. The U.S. is also to release data on manufacturing activity in the Chicago area as well as government reports on pending home sales, non-farm productivity, labor costs and crude oil stockpiles.
Thursday, December 1
In the euro zone, ECB President Mario Draghi is to speak; his comments will be closely watched for any clues to the possible future direction of monetary policy.
Also Thursday, the U.S. is to release its weekly report on initial jobless claims, while the Institute of Supply Management is to release data on manufacturing activity.
Friday, December 2
The U.S. is to round up the week with a closely watched government report on non-farm employment change, a leading indicator of economic health, as well as data on average hourly earnings and the unemployment rate.
EUR/USD hit 1.3211 on Friday, the pair’s lowest since October 4; the pair subsequently consolidated at 1.3234 by close of trade on Friday, plummeting 2.04% over the week.
The pair is likely to find support at 1.3144, the low of October 4 and resistance at 1.3410, the high of November 24.
The euro dropped 1.48% against the greenback on Wednesday after Germany, the euro zone’s largest economy, missed its EUR6 billion sales target at an auction of 10-year bonds, in its least successful debt sale since the launch of the single currency.
The poorly received auction was due in some part to low bond yields but sparked concerns that the debt crisis may have started affecting the euro zone's largest economy.
Meanwhile, ratings agency Fitch warned that France could lose its triple-A credit rating if European Union leaders fail to take action to prevent the crisis from worsening.
The euro slightly recovered on Thursday after a report showed that German business confidence improved unexpectedly in November.
But investors remained jittery after German Chancellor Angel Merkel reiterated her belief that joint euro zone bonds would remove incentives for individual states to improve their fiscal discipline and rejected calls for an expanded role for the ECB in fighting the debt crisis.
The single currency extended losses against the dollar on Friday, after Italian 10-year bond yields climbed to near unsustainable levels, rising above 7% even as the European Central Bank bought bonds in the secondary market.
The rise in Italian borrowing costs came after a disappointing auction of Italian government debt and fanned fears that the debt crisis in the region is deepening.
Earlier in the week, the U.S. super-committee created to cut the country’s deficit said that it failed to reach a deal, signaling that several tax programs, including a payroll-tax holiday, risk expiring at the beginning of next year. Still, ratings agency Standard & Poor’s reaffirmed it would keep the U.S.’s credit rating at AA+ after stripping the government of its top AAA grade on August 5.
In the week ahead, investors will be eyeing an auction of Belgian government debt on Monday after ratings agency Standard & Poor's downgraded its rating on Belgium by one notch on Friday.
Meanwhile, euro zone finance ministers are to meet Wednesday to discuss details on leveraging the region's bailout fund, although a major announcement is
unlikely.
Also next week, the U.S. is to release its closely watched report on non-farm payrolls.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, November 28
In the euro zone, Germany is to produce preliminary data on consumer price inflation, which accounts for the majority of overall inflation, as well as a report on consumer climate, a leading indicator of consumer spending.
Also Monday, the U.S. is to release official data on new home sales, a leading indicator of economic health.
Tuesday, November 29
The U.S. is to release industry data on house price inflation as well as a report on consumer confidence, a leading indicator of consumer spending.
Wednesday, November 30
In the euro zone, Germany is to publish official data on retail sales and employment change while France is to publish government data on consumer spending. Meanwhile, ECB President Mario Draghi is to speak; his comments will be closely watched for any clues to the possible future direction of monetary policy.
The single currency bloc is also to produce preliminary data on consumer price inflation and the unemployment rate. In addition, finance ministers from European Union member states are to meet in Brussels to discuss the ongoing financial crisis in the region.
Later in the day, the U.S. is to release a closely watched report on non-farm payrolls compiled by payroll processing firm ADP, which leads government data by two days. The U.S. is also to release data on manufacturing activity in the Chicago area as well as government reports on pending home sales, non-farm productivity, labor costs and crude oil stockpiles.
Thursday, December 1
In the euro zone, ECB President Mario Draghi is to speak; his comments will be closely watched for any clues to the possible future direction of monetary policy.
Also Thursday, the U.S. is to release its weekly report on initial jobless claims, while the Institute of Supply Management is to release data on manufacturing activity.
Friday, December 2
The U.S. is to round up the week with a closely watched government report on non-farm employment change, a leading indicator of economic health, as well as data on average hourly earnings and the unemployment rate.