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Forex - EUR/USD holds steady, near 11-month lows after U.S. data

Published 08/29/2014, 10:05 AM
Updated 08/29/2014, 10:05 AM
Euro remains near 11-month lows vs. dollar after upbeat U.S. reports

Investing.com - The euro held steady against the U.S. dollar on Friday, hovering close to 11-month lows as the release of strong U.S. consumer sentiment data added to the opinion that the U.S. economic recovery is on track.

EUR/USD hit 1.3169 during U.S. morning trade, the session low; the pair subsequently consolidated at 1.3179, dipping 0.02%.

The pair was likely to find support at 1.3153, the low of August 27 and an 11-month low and resistance at 1.3243, the high of August 24.

The University of Michigan said its consumer sentiment index was revised to 82.5 this month, up from a preliminary reading of 79.2, exceeding expectations for a reading of 80.1.

Data also showed that the Chicago purchasing managers' index rose to 64.3 in August, from a reading of 52.6 the previous month, beating expectations for an increase to 56.0.

Earlier in the day, the Bureau of Economic Analysis reported that U.S. personal spending fell 0.1% last month, confounding expectations for a 0.2% rise, after an increase of 0.4% in June.

The report also showed that U.S. personal income rose 0.2% in July, less than the expected 0.3% gain. The change in personal income for June was revised to a 0.5% increase from a previously estimated 0.4% rise.

In the euro zone, preliminary data showed that consumer price inflation ticked down to an annualized rate of 0.3% this month from 0.4% in July , in line with expectations.

Core CPI, which excludes food, energy, alcohol, and tobacco, rose to 0.9% in August compared to a year ealier, from 0.8% in July. Analysts had expected core CPI to remain unchanged this month.

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A separate report showed that the euro zone's unemployment rate remained unchanged at 11.5% last month, in line with expectations.

In addition, official data showed that German retail sales declined 1.4% in July, disappointing expectations for a 0.1% rise, after a 1.0% gain in June, whose figure was revised from a previously estimated 1.3% advance.

The euro was steady against the pound, with EUR/GBP easing 0.02% to 0.7945.

Investors were also focusing on developments in Ukraine after the nation's President Petro Poroshenko said Russian troops have "de facto" entered his country.

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