Investing.com - The euro rose to session highs against the dollar on Tuesday after the International Monetary Fund raised its 2013 growth forecast for the euro zone, while investors continued to fret over the political deadlock in Washington.
EUR/USD hit 1.3601 during U.S. morning trade, the session high; the pair subsequently consolidated at 1.3591, gaining 0.09%.
The pair was likely to find support at 1.3537, the low of October 4 and resistance at 1.3631, the high of October 4 and an almost eight-month high.
The euro was boosted after the IMF said it now expected the euro zone economy to contract by 0.4% this year and not by 0.5% as it forecast in July. It left its 2014 growth forecast unchanged at 1%.
In its latest World Economic Outlook report, the IMF said that while the recovery remained tepid even peripheral euro zone countries should emerge from recession over the next year.
The IMF downgraded its forecasts for the global economy, saying it now expects growth of 2.9% this year, down from 3.1%. It expects growth of 3.6% in 2014, down from 3.8%.
The dollar remained under pressure as a partial U.S. government shutdown dragged on, with few signs of progress towards a resolution ahead of a deadline to avoid a U.S. sovereign default.
President Barack Obama repeated Monday that he is willing to negotiate with congressional Republicans on a range of topics, including healthcare and energy policy, but only after the government is reopened.
President Obama also called on Congress to raise the government borrowing limit ahead of the October 17 deadline, when the Treasury Department has estimated the U.S. government will not have enough cash to pay its bills.
IMF Chief Economist Olivier Blanchard said Tuesday that a prolonged failure to raise the U.S. debt ceiling would "almost certainly derail the recovery", and warned the U.S. to slow the pace of its deficit reduction program.
The euro was almost unchanged against the pound, with EUR/GBP dipping 0.04% to 0.8433 and was higher against the yen, with EUR/JPY advancing 0.48% to 131.93.
Sterling found support after the IMF upgraded its outlook for the U.K. on Tuesday. The Fund now expects the U.K. economy to expand by 1.4% this year, up from 0.9% and sees growth of 1.9% in 2014, up from its July forecast of 1.5%.
EUR/USD hit 1.3601 during U.S. morning trade, the session high; the pair subsequently consolidated at 1.3591, gaining 0.09%.
The pair was likely to find support at 1.3537, the low of October 4 and resistance at 1.3631, the high of October 4 and an almost eight-month high.
The euro was boosted after the IMF said it now expected the euro zone economy to contract by 0.4% this year and not by 0.5% as it forecast in July. It left its 2014 growth forecast unchanged at 1%.
In its latest World Economic Outlook report, the IMF said that while the recovery remained tepid even peripheral euro zone countries should emerge from recession over the next year.
The IMF downgraded its forecasts for the global economy, saying it now expects growth of 2.9% this year, down from 3.1%. It expects growth of 3.6% in 2014, down from 3.8%.
The dollar remained under pressure as a partial U.S. government shutdown dragged on, with few signs of progress towards a resolution ahead of a deadline to avoid a U.S. sovereign default.
President Barack Obama repeated Monday that he is willing to negotiate with congressional Republicans on a range of topics, including healthcare and energy policy, but only after the government is reopened.
President Obama also called on Congress to raise the government borrowing limit ahead of the October 17 deadline, when the Treasury Department has estimated the U.S. government will not have enough cash to pay its bills.
IMF Chief Economist Olivier Blanchard said Tuesday that a prolonged failure to raise the U.S. debt ceiling would "almost certainly derail the recovery", and warned the U.S. to slow the pace of its deficit reduction program.
The euro was almost unchanged against the pound, with EUR/GBP dipping 0.04% to 0.8433 and was higher against the yen, with EUR/JPY advancing 0.48% to 131.93.
Sterling found support after the IMF upgraded its outlook for the U.K. on Tuesday. The Fund now expects the U.K. economy to expand by 1.4% this year, up from 0.9% and sees growth of 1.9% in 2014, up from its July forecast of 1.5%.