Investing.com - The euro slid lower against the dollar on Wednesday as investors turned their attention to the European Central Bank press conference later in the day, but losses were held in check by upbeat euro area economic data and hopes for a breakthrough on a debt deal for Greece.
EUR/USD slid 0.22% to 1.1126 off the one-and-a-half week highs of 1.1193 hit on Tuesday. The pair ended that session up 2.08%.
The single currency edged lower amid caution ahead of the ECB monetary policy announcement and press conference later in the day.
The euro remained supported after data released on Wednesday showed that euro area retail sales rebounded 0.7% in April and were up 2.2% from a year earlier.
Another report showed that the region’s unemployment rate fell to 11.1% in April from 11.2% in March.
The reports came a day after data showing that euro zone consumer prices rose for the first time in six months in May, adding to signs that the recovery in the region is gaining momentum.
Demand for the single currency was also underpinned by hopes that Greece will soon reach an agreement with its international lenders on a cash-for-reforms deal.
On Tuesday, Greece's international lenders drafted an agreement to present to Athens in a bid to make a breakthrough in protracted negotiations and release financial aid before the country runs out of money.
Greece is due to make a €305 million payment to the International Monetary Fund on Friday but has warned that it will be unable to make the repayment if a deal is not reached by then.
Elsewhere, the euro eased back from five-month highs against the yen, with EUR/JPY at 138.33, off Tuesday’s peaks of 138.86.
The dollar pushed higher after weakening across the board when data on Tuesday showing that U.S. factory orders unexpectedly fell in April sparked fears the growth could struggle to pick up in the current quarter after a weak first quarter.
USD/JPY was up 0.2% to 124.35, holding below Tuesday’s 12-and-a-half-year highs of 125.06.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.26% to 96.25, off overnight lows of 95.69.