Investing.com - The euro extended losses against the U.S. dollar on Wednesday, after an auction of German 10-year government bonds met with lower than average investor demand.
EUR/USD hit 1.2976 during European early afternoon trade, the daily low; the pair subsequently consolidated at 1.2984, shedding 0.50%.
The pair was likely to find support at 1.2911, the low of December 28 and resistance at 1.3118, the high of December 22.
Germany sold EUR4.06 billion of 10-year bonds earlier at an average yield of 1.93%, compared with 1.98% at November's launch of the January 2022 bond, which was one of the worst German debt auctions since the inception of the single currency.
The auction came after data showed that service sector activity in the euro zone contracted for the fourth consecutive month in December, albeit at a slower pace than initially estimated.
Adding to concerns over the euro zone’s debt woes, bank deposits at the European Central Bank's overnight facility reached a new all-time high of EUR453 billion on Tuesday, underscoring the unwillingness of European lenders to lend to each other.
A separate report showed that the rate of consumer price inflation in the euro zone eased to 2.8% from 3% in December, supporting the view that the European Central Bank could cut rates further to bolster growth.
Elsewhere, the euro was trading close to a one-year low against the pound and a decade low against the yen with EUR/GBP retreating 0.25%, to hit 0.8317 and EUR/JPY shedding 0.53%, to hit 99.60.
Later in the day, the U.S. was to release data on factory orders.
EUR/USD hit 1.2976 during European early afternoon trade, the daily low; the pair subsequently consolidated at 1.2984, shedding 0.50%.
The pair was likely to find support at 1.2911, the low of December 28 and resistance at 1.3118, the high of December 22.
Germany sold EUR4.06 billion of 10-year bonds earlier at an average yield of 1.93%, compared with 1.98% at November's launch of the January 2022 bond, which was one of the worst German debt auctions since the inception of the single currency.
The auction came after data showed that service sector activity in the euro zone contracted for the fourth consecutive month in December, albeit at a slower pace than initially estimated.
Adding to concerns over the euro zone’s debt woes, bank deposits at the European Central Bank's overnight facility reached a new all-time high of EUR453 billion on Tuesday, underscoring the unwillingness of European lenders to lend to each other.
A separate report showed that the rate of consumer price inflation in the euro zone eased to 2.8% from 3% in December, supporting the view that the European Central Bank could cut rates further to bolster growth.
Elsewhere, the euro was trading close to a one-year low against the pound and a decade low against the yen with EUR/GBP retreating 0.25%, to hit 0.8317 and EUR/JPY shedding 0.53%, to hit 99.60.
Later in the day, the U.S. was to release data on factory orders.