Investing.com - The euro firmed against the dollar on Tuesday after a poor U.S. consumer confidence report offset upbeat economic growth data and sent investors selling the greenback for profits.
In U.S. trading, EUR/USD was up 0.25% at 1.2472, up from a session low of 1.2403 and off a high of 1.2486.
The pair was likely to find support at 1.2372, Monday's low, and resistance at 1.2600, last Wednesday's high.
The Conference Board market research group reported earlier that consumer confidence index fell to 88.7 this month from a 94.1 in October, whose figure was revised down from a previously reported 94.5.
Analysts expected the index to increase to 95.9 in November, and the surprise deterioration sent investors selling the greenback for profits, wiping out recent gains stemming from preparations for U.S. monetary policy to diverge from Europe and Asia.
The Present Situation Index declined from 94.4 to 91.3, while the Expectations Index decreased sharply to 87.0 from 93.8 in October.
Commenting on the report, director of The Conference Board Consumer Research Center Lynn Franco said, “Consumers were somewhat less positive about current business conditions and the present state of the job market; moreover, their optimism in the short-term outlook in both areas has waned."
Earlier Tuesday, the Commerce Department reported that U.S. gross domestic product grew at a seasonally adjusted annual rate of 3.9% in the third quarter, topping expectations for a reading of 3.3%.
Preliminary data initially pegged U.S. growth at 3.5% in the third quarter. The U.S. economy expanded by 4.6% in the preceding quarter.
The data showed personal consumption rose 2.2% in the third quarter, beating expectations for a 1.9% gain and up from a preliminary estimate of 1.8%.
Consumer spending typically accounts for nearly 70% of U.S. economic growth.
Tuesday's mixed data sent the greenback falling on profit taking.
The dollar has rallied in recent weeks on expectations for U.S. monetary policy to grow less accommodative while European and Asian central banks move in the opposite direction.
Meanwhile in Europe, data revealed that Germany narrowly avoided a recession in the third quarter, posting economic growth of 0.1%.
The report came a day after data showed that German business sentiment improved this month, snapping six successive months of declines.
The upbeat data indicated that the downturn the euro area’s largest economy may have ended and curbed expectations that the European Central Bank may soon embark on quantitative easing measures, which gave the euro support.
Elsewhere, the euro was up against the pound, with EUR/GBP up 0.19% at 0.7937, and down against the yen, with EUR/JPY down 0.05% at 147.09.
On Wednesday, the U.S. is to release a flurry of data ahead of Thursday’s Thanksgiving Day holiday, including reports on durable goods orders, unemployment claims, personal income and spending, as well as reports on new and pending home sales and revised data on consumer sentiment.