Investing.com – The euro extended losses against the U.S. dollar on Wednesday, tumbling to a six-week low, after an auction of 10-year German government bonds met with poor demand and following a string of weak euro zone data.
EUR/USD hit 1.3374 during European early afternoon trade, the pair’s lowest since October 7; the pair subsequently consolidated at 1.3389, tumbling 0.85%.
The pair was likely to find support at 1.3259, the low of October 5 and resistance at 1.3530, the days high.
Germany’s Treasury auctioned just EUR3.64 billion of 10-year government bonds out of the maximum EUR6 billion offered in an auction earlier. Total bids for German debt fell short of the maximum amount available by 35%, the worst demand on record.
The auction came after preliminary data showing that the euro zone manufacturing purchasing managers’ index slumped to the lowest level since July 2009 in November, falling to 46.4 from 47.1 in October.
Manufacturing output in Germany also dropped to a 28-month low, underlining fears that the euro zone could be slipping into a recession.
Service sector activity in the single currency bloc improved slightly, but remained in contraction territory for the third consecutive month in November.
Also Wednesday, official data showed that industrial orders in the euro zone fell significantly more-than-expected in September, tumbling 6.4%, outstripping expectations for a 2.7% decline.
Earlier Wednesday, sentiment on the single currency was hit following reports saying that Belgium and France were in fresh talks over an existing rescue deal for troubled lender Dexia.
The report sparked concerns that France would have to take a larger part in the bailout, which could have implications for the country’s AAA credit rating.
The euro was also lower against the pound, with EUR/GBP shedding 0.49% to hit 0.8594.
Later Wednesday, the U.S. was to publish a string of economic data ahead of Thursday’s Thanksgiving holiday, including a government report on durable goods orders, the weekly report on initial jobless claims as well as data on crude oil stockpiles, inflation, personal income and personal spending.
Meanwhile, the University of Michigan was to release revised data on inflation expectations and consumer sentiment.
EUR/USD hit 1.3374 during European early afternoon trade, the pair’s lowest since October 7; the pair subsequently consolidated at 1.3389, tumbling 0.85%.
The pair was likely to find support at 1.3259, the low of October 5 and resistance at 1.3530, the days high.
Germany’s Treasury auctioned just EUR3.64 billion of 10-year government bonds out of the maximum EUR6 billion offered in an auction earlier. Total bids for German debt fell short of the maximum amount available by 35%, the worst demand on record.
The auction came after preliminary data showing that the euro zone manufacturing purchasing managers’ index slumped to the lowest level since July 2009 in November, falling to 46.4 from 47.1 in October.
Manufacturing output in Germany also dropped to a 28-month low, underlining fears that the euro zone could be slipping into a recession.
Service sector activity in the single currency bloc improved slightly, but remained in contraction territory for the third consecutive month in November.
Also Wednesday, official data showed that industrial orders in the euro zone fell significantly more-than-expected in September, tumbling 6.4%, outstripping expectations for a 2.7% decline.
Earlier Wednesday, sentiment on the single currency was hit following reports saying that Belgium and France were in fresh talks over an existing rescue deal for troubled lender Dexia.
The report sparked concerns that France would have to take a larger part in the bailout, which could have implications for the country’s AAA credit rating.
The euro was also lower against the pound, with EUR/GBP shedding 0.49% to hit 0.8594.
Later Wednesday, the U.S. was to publish a string of economic data ahead of Thursday’s Thanksgiving holiday, including a government report on durable goods orders, the weekly report on initial jobless claims as well as data on crude oil stockpiles, inflation, personal income and personal spending.
Meanwhile, the University of Michigan was to release revised data on inflation expectations and consumer sentiment.