Investing.com - The euro came off a three-and-a-half year low against the pound on Tuesday, amid speculation that Federal Reserve Chairman Ben Bernanke would hint at the possibility of more monetary easing in testimony later Tuesday.
EUR/GBP hit 0.7876 during European morning trade, the session high; the pair subsequently consolidated at 0.7860, easing up 0.15%.
The pair was likely to find support at 0.7831, Monday’s low and the pair’s lowest since early November 2008 and resistance at 0.7912, the high of July 13.
The euro firmed up ahead of testimony by Fed Chairman Ben Bernanke later Tuesday and Wednesday, amid ongoing speculation over whether the U.S. central bank will introduce more easing to stimulate growth.
Expectations for another round of quantitative easing were boosted on Monday after official data showed a third consecutive monthly decline in U.S. retail sales in June.
In June, Bernanke said the Fed remained prepared to take additional steps to support economic growth if necessary, including additional asset purchases.
In the U.K., official data showed that consumer price inflation fell to its lowest in more than two-and-a-half year last month, as retailers offered discounts on clothing and shoes to encourage consumers to spend.
The Office for National Statistics said the annual rate of consumer price inflation dropped to 2.4% from 2.8% in May, the lowest level since November 2009. Economists had expected the rate of inflation to remain unchanged.
The pound was little changed against the U.S. dollar, with GBP/USD inching up 0.01% to 1.5636.
Also Tuesday, data showed that German economic sentiment deteriorated for the third consecutive month in July, as concerns over the euro zone’s ongoing debt crisis continued to weigh.
The ZEW Centre for Economic Research said that its index of German economic sentiment fell to minus 19.6 in July from June’s reading of minus 16.9, but was slightly better than expectations for a decline to minus 20.0.
EUR/GBP hit 0.7876 during European morning trade, the session high; the pair subsequently consolidated at 0.7860, easing up 0.15%.
The pair was likely to find support at 0.7831, Monday’s low and the pair’s lowest since early November 2008 and resistance at 0.7912, the high of July 13.
The euro firmed up ahead of testimony by Fed Chairman Ben Bernanke later Tuesday and Wednesday, amid ongoing speculation over whether the U.S. central bank will introduce more easing to stimulate growth.
Expectations for another round of quantitative easing were boosted on Monday after official data showed a third consecutive monthly decline in U.S. retail sales in June.
In June, Bernanke said the Fed remained prepared to take additional steps to support economic growth if necessary, including additional asset purchases.
In the U.K., official data showed that consumer price inflation fell to its lowest in more than two-and-a-half year last month, as retailers offered discounts on clothing and shoes to encourage consumers to spend.
The Office for National Statistics said the annual rate of consumer price inflation dropped to 2.4% from 2.8% in May, the lowest level since November 2009. Economists had expected the rate of inflation to remain unchanged.
The pound was little changed against the U.S. dollar, with GBP/USD inching up 0.01% to 1.5636.
Also Tuesday, data showed that German economic sentiment deteriorated for the third consecutive month in July, as concerns over the euro zone’s ongoing debt crisis continued to weigh.
The ZEW Centre for Economic Research said that its index of German economic sentiment fell to minus 19.6 in July from June’s reading of minus 16.9, but was slightly better than expectations for a decline to minus 20.0.