Investing.com - The euro extended losses against the dollar and the yen on Thursday after data showing that inflation in the euro zone declined to the lowest level in four years in October fuelled fears that the European Central Bank may tighten monetary policy.
EUR/USD hit 1.3633 during European afternoon trade, the lowest since October 17; the pair subsequently consolidated at 1.3648, shedding 0.63%.
The pair was likely to find support at 1.3600 and resistance at 1.3737, the session high.
The euro slid after Eurostat said consumer price inflation in the currency bloc rose 0.7% in October, the slowest pace since November 2009, after rising 1.1% in September. Economists had expected the rate of inflation to remain unchanged.
The rate is further below the European Central Bank's target of near but just below 2%.
A separate report showed that the euro zone unemployment rate was at a record high 12.2% in September.
The dollar remained supported after the Federal Reserve was less dovish than anticipated in its assessment of the economy, fuelling speculation that it could start scaling back stimulus sooner than expected.
The Fed left its USD85 billion-a-month asset purchase program in place following its monthly meeting on Wednesday. The bank gave no clear indication whether it would start scaling back stimulus at the December meeting or continue it into the start of 2014.
"The housing sector has slowed somewhat in recent months," the Fed statement said. However, Fed officials stuck to the view that the economy is expanding "at a moderate pace" and said downside risks were diminishing.
The dollar showed little reaction after data on Thursday showed that U.S. initial jobless claims fell in line with expectations last week.
The Department of Labor said the number of individuals filing for initial jobless benefits in the week ending October 25 declined by 10,000 to a seasonally adjusted 340,000.
The euro was sharply lower against the yen, with EUR/JPY falling 0.93% to 134.06.
The Bank of Japan made no changes to its stimulus program on Thursday and reiterated that inflation will be close to reaching the bank’s 2% target by April 2015.
Elsewhere, the single currency was also lower against the pound, with EUR/GBP dropping 0.68% to 0.8505.
EUR/USD hit 1.3633 during European afternoon trade, the lowest since October 17; the pair subsequently consolidated at 1.3648, shedding 0.63%.
The pair was likely to find support at 1.3600 and resistance at 1.3737, the session high.
The euro slid after Eurostat said consumer price inflation in the currency bloc rose 0.7% in October, the slowest pace since November 2009, after rising 1.1% in September. Economists had expected the rate of inflation to remain unchanged.
The rate is further below the European Central Bank's target of near but just below 2%.
A separate report showed that the euro zone unemployment rate was at a record high 12.2% in September.
The dollar remained supported after the Federal Reserve was less dovish than anticipated in its assessment of the economy, fuelling speculation that it could start scaling back stimulus sooner than expected.
The Fed left its USD85 billion-a-month asset purchase program in place following its monthly meeting on Wednesday. The bank gave no clear indication whether it would start scaling back stimulus at the December meeting or continue it into the start of 2014.
"The housing sector has slowed somewhat in recent months," the Fed statement said. However, Fed officials stuck to the view that the economy is expanding "at a moderate pace" and said downside risks were diminishing.
The dollar showed little reaction after data on Thursday showed that U.S. initial jobless claims fell in line with expectations last week.
The Department of Labor said the number of individuals filing for initial jobless benefits in the week ending October 25 declined by 10,000 to a seasonally adjusted 340,000.
The euro was sharply lower against the yen, with EUR/JPY falling 0.93% to 134.06.
The Bank of Japan made no changes to its stimulus program on Thursday and reiterated that inflation will be close to reaching the bank’s 2% target by April 2015.
Elsewhere, the single currency was also lower against the pound, with EUR/GBP dropping 0.68% to 0.8505.