Investing.com - The euro eased against the dollar on Wednesday but remained close to one year lows as prospects for additional stimulus measures from the European Central Bank continued to hit investor demand for the single currency.
EUR/USD edged up to 1.3137, off Tuesday’s lows of 1.3109, the weakest level since September 2013.
The pair was likely to find support at the 1.31 level and resistance at around 1.3160.
The euro has come under heavy selling pressure in recent sessions amid mounting expectations that the ECB will announce quantitative easing measures as a way to shore up growth after the annual rate of euro area inflation slowed to a five year low last month.
Concerns that sanctions against Russia would act as a drag on growth in the euro zone also weighed on the single currency.
Demand for the dollar continued to be underpinned after robust U.S. factory data on Tuesday added to the view that the economic recovery is gaining momentum.
The Institute of Supply Management’s manufacturing index jumped to 59 in August, the most since March 2011, while data firm Markit said its manufacturing index rose to 57.9, up from 55.8 in July.
Investors were looking ahead to the latest U.S. employment report, due for release on Friday, for further indications on the strength of the recovery in the labor market, a key factor in deciding the future path of monetary policy.
Expectations that the Federal Reserve is growing closer to raising interest rates have boosted the dollar against the euro and the yen, as the European and Japanese central banks look likely to stick to a looser monetary policy stance.
The euro was lower against the yen, with EUR/JPY slipping 0.13% to 137.83, off Tuesday’s six-week highs of 138.24.
The dollar was also lower against the yen, with USD/JPY down 0.15% to 104.92 after rising to eight-month highs of 105.30 overnight.