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Forex – EUR/USD erases losses in quiet trade ahead of Fed speech

Published 08/24/2011, 07:25 AM
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Investing.com – The euro erased losses against the U.S. dollar in subdued trade on Wednesday, pulling back from the daily low as the greenback remained broadly weaker amid speculation that the Federal Reserve may announce fresh stimulus measures.

EUR/USD pulled back from 1.4381, the daily low, to hit 1.4465 during European early afternoon trade, up 0.18% on the day.

The pair was likely to find support at 1.4258, the low of August 19 and short-term resistance at 1.4499, Tuesday’s high and a four-day high.

Earlier in the day, official data showed that euro zone industrial orders fell unexpectedly in June.

Eurostat said that new industrial orders fell 0.7% in June, after a 3.6% rise in May, the sharpest monthly fall since September 2010. Analysts had expected industrial orders to rise by 0.4%.

A separate report showed that the Ifo Institute's index of German business climate fell to a 14-month low this month, falling to 108.7 from 112.9 in July. Analysts had forecast a decline to 111.

But the dollar remained on the back foot amid speculation that Fed Chairman Ben Bernanke could indicate that further monetary easing may be necessary when he speaks at an economic symposium in Jackson Hole, Wyoming, later in the week.

The euro was also higher against the pound, with EUR/GBP rising 0.13% to hit 0.8767.

Later in the day, the U.S. was to publish government data on durable goods orders.


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