For the 24 hours to 23:00 GMT, EUR rose 0.36% against the USD and closed at 1.3022.
However, gains were limited as Portugal’s political crisis mounted after the back-to-back resignation of ministers from Prime Minister, Pedro Passos Coelho’s coalition government that risks early election in the country which is struggling hard to keep austerity measures on track.
Separately, the European Central Bank Executive Board member, Joerg Asmussen stated that despite the progress made by Greece, the country still has much more to do to complete a positive review by “Troika”. He also added that talks of debt write-downs were unhelpful as they distract from the necessary reform efforts.
On the other hand, Standards and Poors’ upgraded the Cyprus sovereign debt rating from ‘selective default’ to ‘CCC+’, and kept the outlook as stable.
Amidst a string of services Purchasing Managers’ Index (PMI) data released in Europe yesterday, Spanish and French PMI came in better than market consensus in June, while German services PMI rose in June slower than preliminary estimated. Moreover, Euro-zone’s services and composite PMI rose lower than the preliminary estimate in June. Additionally, Euro-zone retail sales rebounded in May.
Meanwhile the employment scenario in the US seemed very favourable following upbeat data from the US labour market. Private sector employment in the US increased 188.00K in June, while initial jobless claims for state employment benefits declined by 5K to a seasonally adjusted 343K in the week ended 29 June 2013. Additionally, continuing jobless claims fell by 54K for the week ended 22 June 2013. However, US trade deficit widened by 12.1% in May to $45.0 billion, the biggest deficit since last November. Also, the nation’s non-manufacturing PMI dropped to a reading of 52.2 in June, from a level of 53.7 recorded in the previous month.
In the Asian session, at GMT0300, the pair is trading at 1.2995, with the EUR trading 0.21% lower from yesterday’s close.
The pair is expected to find support at 1.2934, and a fall through could take it to the next support level of 1.2872. The pair is expected to find its first resistance at 1.3045, and a rise through could take it to the next resistance level of 1.3094.
The currency pair is showing convergence with its 20 Hr and 50 Hr moving averages.