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Forex - Euro falls to session lows

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Investing.com - The euro fell to session lows against the dollar on Wednesday following reports in Bloomberg that the European Central Bank will consider cutting deposit rates to below zero if more easing is needed.

EUR/USD fell 0.54% to 1.3464 during U.S. morning trade, down from Tuesday's close of 1.3537.

The pair was likely to find support at 1.3431, the low of November 15 and resistance at 1.3550.

The euro tumbled after Bloomberg reported that sources close to the ECB said the bank is to weigh a -0.1% deposit rate if more easing is required.

The ECB surprised investors after it unexpectedly cut rates to a record low 0.25% earlier this month amid concerns over mounting deflationary pressures in the euro area.

Meanwhile, investors were awaiting the minutes of the Federal Reserve's October meeting, due out later in the trading day.

Fed Chairman Ben Bernanke reiterated the bank's commitment to highly accommodative monetary policy on Tuesday and said the Fed would only taper its USD85 billion-a-month asset purchase program when it was assured of a sustained recovery in the labor market.

The minutes were expected to reveal more details on the bank's decision to stick with the stimulus program last month.

Data released on Wednesday showed that U.S. retail sales rose 0.4% in October, beating expectations for a 0.1% increase. Core retail sales were up 0.2%, above expectations for a 0.1% rise.

Another report showed that U.S. consumer prices fell for the first time in six months in October, declining 0.1%.

Meanwhile, private sector data showed that U.S. existing home sales fell slightly in October.

The euro dropped to session lows against the pound and the yen, with EUR/GBP down 0.80% to 0.8330 and EUR/JPY falling 0.65% to 134.67.

Elsewhere, the dollar was almost unchanged against the yen, with USD/JPY dipping 0.05% to 100.07, holding below the two-month high of 100.42 struck on Friday.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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