Forex - Euro hits 3-week high against broadly weaker dollar

Published 12/14/2010, 05:59 AM
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Investing.com – The euro extended early gains against the U.S. dollar on Tuesday, surging to a 3-week high as U.S. Treasury yields retreated from recent multi-month highs ahead of a meeting of Federal Reserve policy makers.

EUR/USD hit 1.3491 during European morning trade, the pair’s highest since November 23; the pair subsequently consolidated at 1.3488, soaring 0.73%.

The pair was likely to find support at 1.3181, Monday’s low and resistance at 1.3632, the high of November 23.

Earlier in the day, the ZEW Centre for Economic Research said that its index of German economic sentiment rose to 4.3 in December, after rising to 1.8 in November. Analysts had expected the index to advance to 3.9 in December.

The current conditions index rose to 82.6 from 81.5 in November, but was below forecasts for 84.0.

Elsewhere, official data showed that industrial production in the euro zone rose less-than-expected in October, increasing 0.7%, less than the forecasted 1.3% gain.

Year-on-year, the rate of industrial production rose by 6.9% in October, after rising by 5.4% in September.

The euro was also higher against the pound, with EUR/GBP surging 0.61% to hit 0.8495.

Later in the day, the U.S. was to release official data on retail sales and producer price inflation. In addition, the Federal Reserve was to announce its federal funds rate.

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