EURUSD Movement
For the 24 hours to 23:00 GMT, EUR declined 0.53% against the USD and closed at 1.2978, after economic data indicated that the gross domestic product in the Euro-zone contracted 0.6% (QoQ) in the Q42012, in line with market consensus and compared to a similar fall recorded in the previous quarter. Meanwhile, the IHS Global Insight indicated that economic fundamentals remain generally poor for consumer spending in most Euro-zone countries with unemployment high and rising, and purchasing power limited by muted wage growth and tight fiscal policy.
The greenback registered gains after US private sector employment surged more-than-expected in February, while the MBA mortgage applications surged last week.
Further supporting the greenback, the latest Federal Reserve (Fed) Beige Book survey indicated that the US economy continued to expand at a modest to moderate pace in January and early February.
In the Asian session, at GMT0400, the pair is trading at 1.2993, with the EUR trading 0.12% higher from yesterday’s close.
In morning news, Portugal’s credit rating outlook was raised to “Stable” from “Negative” by ratings agency, Standard & Poor’s, citing that the European lenders would continue to support the nation’s efforts to get its fiscal house in order.
The pair is expected to find support at 1.2948, and a fall through could take it to the next support level of 1.2903. The pair is expected to find its first resistance at 1.3055, and a rise through could take it to the next resistance level of 1.3117.
In economic releases, German factory orders, French trade balance and Italian trade balance is awaited by investors. However, it is the European Central Bank (ECB) interest rate decision that holds market attention for today. Also, the US is to publish its weekly government report on initial jobless claims and official data on the trade balance.
The currency pair is trading below its 20 Hr and 50 Hr moving averages.
