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Forex - EUR/USD eases, supported near 7-week high

Published 08/29/2012, 08:09 AM
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Investing.com - The euro slipped lower against the U.S. dollar on Wednesday, but remained supported close to a seven-week high, as investors awaited more details of European Central Bank plans to stem the debt crisis in the region, as well as a speech by Federal Reserve Chairman Ben Bernanke on Friday.

EUR/USD hit 1.2532 during European afternoon trade, the session high; the pair subsequently consolidated at 1.2543, slipping 0.17%.

The pair was likely to find support at 1.2464, Tuesday’s low and resistance at 1.2588, the high of August 23, a seven-week high.

Demand for the single currency continued to be underpinned by expectations that the ECB is working on measures to help stabilize the euro zone's sovereign debt markets, ahead of its next policy meeting on September 6.

Earlier Wednesday, Italy saw borrowing costs decline to the lowest level since March after it auctioned EUR9 billion of six-month government bonds, reflecting investor confidence that the ECB will soon act to lower high euro zone peripheral bond yields.

Elsewhere, official data showed that German consumer price inflation accelerated at the fastest rate since May this month, rising 0.3%, compared to expectations for a 0.2% increase.

Meanwhile, investors were anticipating a speech by the Federal Reserve chairman at an annual symposium in Jackson Hole, Wyoming on Friday, amid ongoing speculation over how close the U.S. central bank is to implementing more stimulus measures.

The euro was lower against the pound, with EUR/GBP sliding 0.26% to 0.7921, but remained little changed against the yen, with EUR/JPY dipping 0.02% to 98.61.

Later in the day, the U.S. was to release revised data on second quarter economic growth, as well as industry data on pending home sales.



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