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Forex - EUR/USD higher as Summers exits Fed race

Published 09/16/2013, 02:36 AM
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Investing.com - The euro was higher against the broadly weaker dollar on Monday after Lawrence Summers withdrew from the contest to succeed Ben Bernanke as the next chairman of the Federal Reserve.

EUR/USD hit 1.3382 during late Asian trade, the highest since August 28; the pair subsequently consolidated at 1.3368, advancing 0.54%.

The pair was likely to find support at 1.3253, Friday’s low and resistance at 1.3400.

The dollar weakened broadly after Summers pulled out of the race to be the next Fed chairman, easing investor concerns that he would roll back economic stimulus measures more aggressively than his main rival for the post, Janet Yellen.

The dollar was also under pressure as investors looked ahead to Wednesday’s outcome of the upcoming Fed meeting, after a recent series of lukewarm U.S. data raised doubts over whether the central bank will start to taper its USD85 billion-a-month bond buying program.

Elsewhere, the euro was steady against the pound and the yen, with EUR/GBP inching up 0.06% to 0.8378 and EUR/JPY dipping 0.06% 132.02.

The euro zone was to release data on consumer price inflation later Monday, while European Central Bank President Mario Draghi was to speak in Berlin.

The U.S. was to publish the Empire state manufacturing index, in addition to data on industrial production and the capacity utilization rate.




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