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Forex - EUR/USD remains lower as debt concerns weigh

Published 11/21/2011, 06:30 AM
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Investing.com - The euro remained lower against the U.S. dollar on Monday, as growing concerns over the sovereign debt crisis and the U.S. weighed on demand for the single currency.

EUR/USD hit 1.3438 during late European morning trade, the pair’s lowest since November 17; the pair subsequently consolidated at 1.3444, shedding 0.59%.

The pair was likely to find support at 1.3377, the low of October 10 and resistance at 1.3613, the high of November 18.

Earlier in the day, the spread between 10-year Spanish bond yields and their German counterparts widened as investors remained jittery despite the election of a new government.

Spain’s center-right opposition People's Party took a majority in Parliament after elections on Sunday and was expected to push through drastic austerity measures to try shore up the country’s economy and regain the country’s triple A credit rating.

Also Monday, rating agency Moody's said a rise in French government debt yields and weaker growth prospects could be negative for the outlook on the country's credit rating.

Meanwhile, speculation that a U.S. congressional "super committee" was set to announce that it had failed in a three-month-long effort to draft a USD1.2 trillion deficit reduction plan weighed on market sentiment.

Elsewhere, the euro was higher against the pound with EUR/GBP rising 0.35%, to trade at 0.8589.

Later in the day, the U.S. was to release industry data on existing home sales.

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