Investing.com - The euro drifted lower against the dollar on Wednesday as ongoing uncertainty over the growth outlook for China weighed, while a dearth of economic data meant that markets lacked clear direction.
EUR/USD hit session lows of 1.3718 and was last down 0.12% to 1.3727.
The pair was likely to find support at 1.3600 and resistance at 1.3770.
Investors remained cautious after China’s yuan fell sharply on Tuesday, adding to losses in recent weeks, amid speculation that the country’s central bank has intervened to add volatility to the currency ahead of possible economic reforms.
Meanwhile, Tuesday’s discouraging data on U.S. consumer sentiment added to concerns that the economic recovery has lost momentum since the end of last year. Recent weak U.S. economic indicators have raised doubts over whether the Federal Reserve will continue the current pace of reductions to its stimulus program.
The U.S. was to release data on new home sales later in the trading day.
The euro showed little reaction after data on Wednesday showed that Germany’s forward looking Gfk consumer sentiment index ticked up to a seven-year high of 8.5 for March from 8.3 in February.
The euro was little changed against the yen, with EUR/JPY dipping 0.02% to 140.47.
Elsewhere, the common currency was lower against the pound, with EUR/GBP slipping 0.014% to 0.8227.
Sterling found support after data on Wednesday confirmed that the rate of fourth quarter economic growth in the U.K. was unrevised at 0.7%.
On a year-over-year basis, the U.K. economy expanded by 2.7% in the fourth quarter, down slightly from the preliminary estimate for 2.8% growth.