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Forex - EUR/USD hits daily highs on Schauble comments

Published 08/27/2014, 11:17 AM
Updated 08/27/2014, 11:19 AM
Euro firms as Schauble says markets have misinterpreted Draghi comments

Investing.com - The euro firmed to daily highs against the dollar on Wednesday after German Finance Minister Wolfgang Schauble said markets may have branded recent comments out of the European Central Bank as overly dovish.

In U.S. trading, EUR/USD was up 0.27% at 1.3203, up from a session low of 1.3153 and off a high of 1.3210.

The pair was likely to find support at 1.3105, the low from Sept. 6, 2013, and resistance at 1.3215, Tuesday's high.

The single currency strengthened after German Finance Minister Wolfgang Schauble said comments made by European Central Bank President Mario Draghi Draghi suggesting fiscal policy could spur growth were "overinterpreted."

Draghi said week that the policy makers are ready to take more unconventional action if needed to stimulate a sluggish euro zone economy, which left many pondering the possibility that fiscal stimulus could accompany loose monetary policies to jumpstart European recovery.

Elsewhere, data revealed that the Gfk German consumer climate index fell to 8.6 this month from 9.0 in July. Analysts had expected the index to remain unchanged in August, though Schauble's comments served as the pair's chief steering current.

Profit taking, meanwhile, nudged the dollar lower.

The dollar advanced in recent sessions due to upbeat economic indicators and optimistic comments from Federal Reserve Chair Janet Yellen.

Elsewhere, the euro was down against the pound, with EUR/GBP down 0.03% at 0.7959, and up against the yen, with EUR/JPY up 0.12% at 137.19.

On Thursday, markets will focus more on the U.S. and move on gross domestic product data, weekly initial jobless claims and a report on pending home sales.

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