Forex - EUR/USD holds steady after UoM report disappoints

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Investing.com - The euro held steady against the U.S. dollar on Friday, as disappointing U.S. consumer sentiment data did little to support demand for the greenback, while concerns over violence in Irak continued to weigh.

EUR/USD hit 1.3530 during U.S. morning trade, the session low; the pair subsequently consolidated at 1.3544, down 0.06%.

The pair was likely to find support at 1.3503, the low of June 5 and a four-month low and resistance at 1.3602, the high of June 10.


In a preliminary report, the University of Michigan said its consumer sentiment index fell to 81.2 this month from 81.9 in May, whose figure was revised up from a previously estimated reading of 81.8. Analysts had expected the index to rise to 83.0 in June.

Earlier Friday, official data showed that U.S. producer price inflation fell 0.2% in May, confounding expectations for a 0.1% rise, after a 0.6% increase the previous month.

Core producer price inflation, which excludes food, energy and trade, slipped 0.1% last month, compared to expectations for an increase of 0.1%, after a 0.5% rise in April.

Meanwhile, market sentiment remained under pressure after U.S. President Barack Obama warned of possible military strikes in Iraq after a rebellion led by a Sunni Islamist group continued to spread rapidly through the country.

Late on Thursday, Kurdish forces in the north took control of Kirkuk to protect it from the Islamists.

The single currency had found some support on Thursday after data showed that industrial production in the euro zone increased by 0.8% in April, above forecasts for a 0.4% gain. Industrial production in March was revised down to a decline of 0.4% from a previously reported drop of 0.3%.

The euro was lower against the pound, with EUR/GBP shedding 0.24% to 0.7987.

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This article appears in: Investing , Forex and Currencies

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