EURUSD Movement
For the 24 hours to 23:00 GMT on Friday, EUR rose 0.46% against the USD and closed at 1.3363, as risk appetite increased after Spain revealed a budget plan to save more than €27 billion ($35.96 billion) in 2012 through spending cuts and revenue increases, while Euro-zone Finance Ministers agreed to raise their financial firewall to contain the region’s debt crisis.
The firewall is to be comprised of €500 billion from the European Stability Mechanism, which would come in to effect from July 2012, another €200 billion already committed in loans to Greece, Ireland and Portugal and €100 billion in bilateral loans and European Union funds.
Meanwhile, in economic news, on a working-day and seasonally adjusted basis, consumer spending in France climbed 3.0% (MoM) in February, marking the biggest increase since November 1995. Additionally, the Producer Price Index (PPI) in France rose 4.3% (YoY) in February, compared to the same rate of growth recorded in January.
Separately, on a seasonally adjusted basis, German retail sales declined 1.1% (MoM) in February, from a 1.2% decline in January.
On Friday, IMF Managing Director, Christine Lagarde stated that Europe’s upgraded strategy would “support the IMF’s efforts to increase its available resources for the benefit of all our members.”
In the Asian session, at GMT0300, the pair is trading at 1.3341, with the EUR trading 0.05% lower from Friday’s close.
Today morning, the Italian Prime Minister, Mario Monti stated that Italy’s economy has stabilized, but it may still pose a risk to the Euro-zone.
The pair is expected to find support at 1.3308, and a fall through could take it to the next support level of 1.3275. The pair is expected to find its first resistance at 1.3375, and a rise through could take it to the next resistance level of 1.3409.
Investors are awaiting manufacturing Purchasing Manager Index and unemployment data in the Euro-zone later today.
The currency pair is trading between its 20 Hr and 50 Hr moving averages.
