We have updated our privacy policy and terms & conditions. Find out more here.

Forex - EUR/USD gains on demand for higher-yielding currencies

ForexApr 16, 2013 04:39PM GMT 1 Comment
Share with a Friend
Thanks for sharing
Emails have been sent to:
To send more emails click here
Investing.com -  The euro firmed against the dollar on Tuesday after investors digested conflicting economic data out of the U.S. and Europe and later decided the conditions were healthy enough to ditch the safe-haven dollar and chase yield.

In U.S. trading on Tuesday, EUR/USD was up 0.76% at 1.3136, up from a session low of 1.3021 and off from a high of 1.3151.

The pair was likely to find support at 1.3021, the earlier low, and resistance at 1.3162, the high from Feb. 27.

In Europe earlier, Germany's ZEW index of economic sentiment index dropped to 36.3 in April from 48.5 in March, falling short of market expectations for a 42.0 reading.

The broader eurozone ZEW economic sentiment index ticked down to 24.9 this month from 33.4 in March, also falling short of market expectations, which were forecasting a 31.5 reading.

Prices in Europe, however, remain stable.

Eurostat reported earlier that the eurozone's consumer price index remained unchanged at an annualized rate of 1.7% in March, in line with expectations.

Core CPI in the single currency bloc rose 1.5% last month, up from 1.3% in February and beating market expectations for a rise to 1.4%.

Meanwhile in the U.S., the Census Bureau reported earlier that building permits rose by 902,000 in March, less than market calls for 940,000 increase and also below the 968,000-unit rise in February.

Housing starts, however, rose by 1.036 million units last month, beating market forecasts for an increase of 930,000 after a rise of 986,000 in February.

Separate government data revealed that consumer inflation dipped in March due in part to falling fuel prices.

The U.S. Bureau of Labor Statistics reported earlier Tuesday that the country's consumer price index fell 0.2% in March after rising 0.7% in February, missing expectations for a 0.1% gain.

Separately, the U.S. core CPI, which is stripped of volatile food and energy costs, rose 0.1% in March,  missing expectations for a 0.2% increase after a 0.2% rise the previous month.

In addition, the Federal Reserve reported that U.S. industrial production rose 0.4% in March, beating expectations for a 0.2% gain after a 1.1% increase the previous month, which gave investors reason to abandon the safe-haven dollar and seek higher-yielding currencies.

Recoveries in commodities markets also enticed investors out of the safety of the greenback.

The euro, meanwhile, was up against the pound and up against the yen, with EUR/GBP trading up 0.67% at 0.8588, and EUR/JPY trading up 2.10% at 128.78.

On Wednesday, Germany is to hold an auction of 10-year government bonds.

The U.S. will release industry data on mortgage applications as well as official data on oil inventories.

The Federal Reserve will release its Beige Book survey.

Forex - EUR/USD gains on demand for higher-yielding currencies

Related Articles

Forex - USD/CAD slips lower in early trade
Forex - USD/CAD slips lower in early trade
By Investing.com - Apr 01, 2015

Investing.com - The U.S. dollar slipped lower against its Canadian counterpart on Wednesday, after data showed that U.S. non-farm private employment rose less than expected in ...

Dollar broadly supported vs. rivals, U.S. data on tap
Dollar broadly supported vs. rivals, U.S. data on tap
By Investing.com - Apr 01, 2015

Investing.com - The dollar was broadly higher against a basket of other major currencies on Wednesday, as growing expectations for a U.S. rate hike in the coming months continued ...

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Are you sure you want to delete this chart?
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Chris Lem
Chris Lem Apr 16, 2013 05:11PM GMT
Um, EURUSD is not high yielding.
Are you sure you want to delete this chart?

Successfully Reported

Thank you. This comment has been flagged for a moderator.
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data .

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.