Investing.com - The euro was lower against the dollar on Friday as investors took profits after a week which saw steep declines in the dollar, but concerns over political deadlock in the U.S. curbed demand for the dollar.
EUR/USD ended Friday’s session at 1.3554, down 0.47% for the day, after rising to eight-month highs of 1.3645 on Thursday. For the week, the pair gained 0.23%.
The pair is likely to find support at 1.3476, the low of September 30 and resistance at 1.3645, Thursday’s high.
The dollar looked likely to remain under pressure amid concerns that the first U.S. government shutdown for 17 years would derail the fragile economic recovery and prompt the Federal Reserve to maintain its stimulus program for longer.
Markets were also mulling over how the political deadlock in Washington will impact on negotiations to raise the U.S. debt ceiling, which the U.S. Treasury Department has estimated will be reached by October 17.
House Republican Leader John Boehner said Friday the House will not vote on a budget bill without conditions to end the government shutdown, and demanded spending cuts in exchange for raising the government's borrowing limit.
The shutdown meant that Friday’s scheduled release of the U.S. nonfarm payrolls report for September was postponed and no new date was given for the release of the data.
In the euro zone, Italian Prime Minister Enrico Letta survived a vote of confidence in parliament on Wednesday, after Silvio Berlusconi dropped his opposition to the coalition, in a surprise U-turn.
Elsewhere, the European Central Bank left interest rates on hold at 0.5% on Wednesday, in a widely expected decision.
ECB President Mario Draghi said risks to the euro zone economy remained to the downside, before reiterating that bank rates would remain at current or lower levels for an “extended period of time”, given the subdued inflation outlook and low levels of growth in the region.
Draghi also reiterated that the ECB remains ready to extend a third round of ultra-cheap loans to banks, in order to safeguard the recovery.
In the week ahead, investors will continue to closely monitor political developments in Washington. Delays in U.S. economic data releases look likely to fuel uncertainty over whether the Federal Reserve will hold off on any move to roll back its USD85 billion a month asset purchase program.
In the euro zone, investors will be awaiting German trade data as well as reports on factory orders and industrial production to assess the strength of the bloc’s largest economy.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets. The guide skips Monday as there are no relevant events on this day.
Tuesday, October 8
Germany is to release data on the trade balance and factory orders.
Wednesday, October 9
Germany is to produce official data on industrial production, a leading indicator of economic health.
Thursday, October 10
The ECB is to publish its monthly bulletin, which outlines the bank’s economic outlook.
Friday, October 11
Italy is to hold an auction of 10-year government bonds.
EUR/USD ended Friday’s session at 1.3554, down 0.47% for the day, after rising to eight-month highs of 1.3645 on Thursday. For the week, the pair gained 0.23%.
The pair is likely to find support at 1.3476, the low of September 30 and resistance at 1.3645, Thursday’s high.
The dollar looked likely to remain under pressure amid concerns that the first U.S. government shutdown for 17 years would derail the fragile economic recovery and prompt the Federal Reserve to maintain its stimulus program for longer.
Markets were also mulling over how the political deadlock in Washington will impact on negotiations to raise the U.S. debt ceiling, which the U.S. Treasury Department has estimated will be reached by October 17.
House Republican Leader John Boehner said Friday the House will not vote on a budget bill without conditions to end the government shutdown, and demanded spending cuts in exchange for raising the government's borrowing limit.
The shutdown meant that Friday’s scheduled release of the U.S. nonfarm payrolls report for September was postponed and no new date was given for the release of the data.
In the euro zone, Italian Prime Minister Enrico Letta survived a vote of confidence in parliament on Wednesday, after Silvio Berlusconi dropped his opposition to the coalition, in a surprise U-turn.
Elsewhere, the European Central Bank left interest rates on hold at 0.5% on Wednesday, in a widely expected decision.
ECB President Mario Draghi said risks to the euro zone economy remained to the downside, before reiterating that bank rates would remain at current or lower levels for an “extended period of time”, given the subdued inflation outlook and low levels of growth in the region.
Draghi also reiterated that the ECB remains ready to extend a third round of ultra-cheap loans to banks, in order to safeguard the recovery.
In the week ahead, investors will continue to closely monitor political developments in Washington. Delays in U.S. economic data releases look likely to fuel uncertainty over whether the Federal Reserve will hold off on any move to roll back its USD85 billion a month asset purchase program.
In the euro zone, investors will be awaiting German trade data as well as reports on factory orders and industrial production to assess the strength of the bloc’s largest economy.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets. The guide skips Monday as there are no relevant events on this day.
Tuesday, October 8
Germany is to release data on the trade balance and factory orders.
Wednesday, October 9
Germany is to produce official data on industrial production, a leading indicator of economic health.
Thursday, October 10
The ECB is to publish its monthly bulletin, which outlines the bank’s economic outlook.
Friday, October 11
Italy is to hold an auction of 10-year government bonds.