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Forex - EUR/USD steady close to 12-week high

Published 02/28/2012, 07:20 AM
Updated 02/28/2012, 07:20 AM

Investing.com - The euro was steady against the U.S. dollar on Tuesday, trading close to a 12-week high amid expectations that a liquidity operation by the European Central Bank would fuel risk appetite.

EUR/USD hit 1.3462 during European early afternoon trade, the session high; the pair subsequently consolidated at 1.3449, gaining 0.38%.

The pair was likely to find support at 1.3356, last Friday’s low and resistance at 1.3485, Friday’s high and a 12-week high.

Sentiment on the single currency was buoyed as markets looked ahead to Wednesday's launch of the ECB’s second three-year long-term refinancing operation, after a similar liquidity injection in December averted a credit crunch and eased pressure on peripheral euro zone bond markets.

The euro remained supported following Monday’s announcement by ratings agency Standard & Poor’s that it had cut Greece’s long term credit rating to 'selective default' after the country embarked on a debt swap deal with its private creditors.

Portugal’s finance minister said earlier that the country had passed the third review of its EUR78 billion bailout by the troika, which is composed of the ECB, European Union and International Monetary Fund, and added that the country’s fiscal targets for 2012 would be met in spite of deteriorating economic conditions.

The euro was also higher against the pound and the yen, with EUR/GBP rising 0.24% to hit 0.8486 and EUR/JPY up 0.24% to hit 108.24.

Later in the day, Germany was to release official data on consumer price inflation, while the U.S. was to produce official data on durable goods orders, as well as reports on house price inflation and consumer confidence.


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