Investing.com - The euro hit session highs against the dollar and the yen on Wednesday amid market talk that sources close to the European Central Bank said a rate cut on Thursday was unlikely.
EUR/USD hit 1.3548 during U.S. morning trade, the highest since November 1; the pair subsequently consolidated at 1.3539, gaining 0.47%.
The pair was likely to find support at 1.3448, Tuesday’s low and an almost one-and-a-half month low and resistance at 1.3570.
The euro strengthened across the board following reports that ECB sources said the bank was unlikely to cut rates at its monthly meeting on Thursday despite data last week showing that euro zone annual inflation fell to a four year low in October.
The euro had moved higher earlier in the session after robust German factory data offset concerns over possible monetary easing by the ECB in order to safeguard the economic recovery in the region.
German factory orders rose 3.3% in September, easily outstripping expectations for a gain of 0.5% and were 7.9% higher on a year-over-year basis.
Meanwhile, revised data showed that the final reading of the euro zone’s services purchasing managers’ index ticked down to 51.6 in October from 52.2 in September, but was higher than a preliminary estimate of 50.9.
A separate report showed that euro zone retail sales fell 0.6% in September, compared to expectations for a 0.4% decline.
While no policy change was expected from the ECB at its monthly meeting on Thursday many investors expected the bank to signal the possibility of further rate cuts at its meeting in December.
The European Commission cut its forecast for euro zone growth on Tuesday and said that unemployment in the region remains at unacceptably high levels.
The euro extended gains against the yen, with EUR/JPY up 0.66% to 133.62.
Elsewhere, the shared currency recovered from five-week lows against the pound, with EUR/GBP rising 0.14% to 0.8411 after falling as low as 0.8379 earlier.
Demand for sterling continued to be underpinned after better-than-forecast data on U.K. manufacturing output on Wednesday added to signs that the U.K. economic recovery is gaining traction.
EUR/USD hit 1.3548 during U.S. morning trade, the highest since November 1; the pair subsequently consolidated at 1.3539, gaining 0.47%.
The pair was likely to find support at 1.3448, Tuesday’s low and an almost one-and-a-half month low and resistance at 1.3570.
The euro strengthened across the board following reports that ECB sources said the bank was unlikely to cut rates at its monthly meeting on Thursday despite data last week showing that euro zone annual inflation fell to a four year low in October.
The euro had moved higher earlier in the session after robust German factory data offset concerns over possible monetary easing by the ECB in order to safeguard the economic recovery in the region.
German factory orders rose 3.3% in September, easily outstripping expectations for a gain of 0.5% and were 7.9% higher on a year-over-year basis.
Meanwhile, revised data showed that the final reading of the euro zone’s services purchasing managers’ index ticked down to 51.6 in October from 52.2 in September, but was higher than a preliminary estimate of 50.9.
A separate report showed that euro zone retail sales fell 0.6% in September, compared to expectations for a 0.4% decline.
While no policy change was expected from the ECB at its monthly meeting on Thursday many investors expected the bank to signal the possibility of further rate cuts at its meeting in December.
The European Commission cut its forecast for euro zone growth on Tuesday and said that unemployment in the region remains at unacceptably high levels.
The euro extended gains against the yen, with EUR/JPY up 0.66% to 133.62.
Elsewhere, the shared currency recovered from five-week lows against the pound, with EUR/GBP rising 0.14% to 0.8411 after falling as low as 0.8379 earlier.
Demand for sterling continued to be underpinned after better-than-forecast data on U.K. manufacturing output on Wednesday added to signs that the U.K. economic recovery is gaining traction.