The euro continued its slide against the other major currencies in European deals on Tuesday, after Eurozone inflation fell for the fourth month in a row in March, whereas jobless rate worsened more-than-forecast in February. Market participants are also worried about Greece debt talks, as the country will run out of money in three weeks unless it receive bailout finding.
Flash estimate from Eurostat showed that Eurozone inflation remained negative, with an annual decline of 0.1 percent in March. The index matched economists expectation.
The Eurozone unemployment rate worsened more-than-forecast to 11.3 percent in February, data from the statistical office of the European Union showed. Economists were forecasting a reading of 11.2 percent.
The currency has been in a negative territory due to lack of progress in talks between Greece and its creditors, in order to reach an agreement on reforms to release financial aid. Athens risks default on its financial obligations since it would run out of money by April 20.
The euro was lower against its major opponents, except the franc, on Monday. The EUR/USD pair fell by 0.5 percent yesterday, hurt by continued standoff between Greece and its creditors.
The single currency declined to 1.0712 against the U.S. dollar, its lowest since March 20. Continuation of the euro’s downtrend may lead it to support around the 1.05 zone. The pair ended yesterday’s trading at 1.0831.
The euro declined by 0.8 percent to hit an 8-day low of 0.7254 against the Sterling. If the euro extends slide, it may find support around the 0.72 mark. At Monday’s close, the pair was valued at 0.7312.
The pound received support after data showed that U.K. economy grew more than the prior estimate in the fourth quarter.
Gross domestic product grew 0.6 percent sequentially in the fourth quarter, revised up from 0.5 percent published on February 26, data from the Office for National Statistics showed.
Reversing from an early 4-day high of 130.25 against the yen, the euro slipped to an 11-day low of 128.64. The next possible downside target for the euro-yen pair may be located around the 128.00 area. The euro-yen pair was worth 130.03 when it ended Monday’s trading.
Data from the Ministry of Land, Infrastructure, Transport and Tourism showed that Japanese housing starts declined at a slower than expected pace in February.
Housing starts dropped 3.1 percent in February from last year, slower than January’s 13 percent decline and an expected decrease of 7 percent.
The 19-nation currency pulled back from an early high of 1.0484 against the Swiss franc, and edged down to 1.0445 in European trading. The pair was trading at 1.0476 at Monday’s close. Further weakness is likely to take the euro to a support near the 1.00 mark.
The euro declined to 4-day lows of 1.3652 against the loonie and 1.4346 against the kiwi, off early high of 1.3748 and a 5-day high of 1.4458, respectively. The euro is poised to find downside target around 1.36 against the loonie and 1.42 against the kiwi.
The euro moved away from an early session’s high of 1.4180 against the aussie, edging down to 1.4093. Next key support for the euro may be found around the 1.40 mark.
Looking ahead, Canada GDP for January, U.S. S&P Case Shiller home price index for January, Chicago PMI for March and U.S. consumer confidence index for March are set to be published in the New York session.
At 7:55 am ET, U.S. Federal Reserve Bank of Richmond President Jeffrey Lacker is expected to speak on Economic outlook in Richmond.
Danièle Nouy, chair of the ECB Supervisory Board, will deliver a speech before the European Parliament’s Committee on Economic and Monetary Affairs on Brussels at 9:00 am ET. At the same time, U.S. Federal Reserve Bank of Cleveland President Loretta Mester moderates a policy session at a conference in Stone Mountain, Georgia.
At 3:00 pm ET, U.S. Federal Reserve Bank of Kansas City President Esther George is expected to speak on the U.S. economy in New York.
by RTT Staff Writer
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