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Forex - EUR/USD drops on eurozone retail sales, German factory data

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Investing.com - The euro weakened against the dollar on Tuesday after eurozone retail sales figures missed market expectations, sparking a risk-off trading session.

Soft German factory data pushed the single currency down as well, sending investors to the safety of the greenback.

In U.S. trading on Tuesday, EUR/USD was trading down 0.35% at 1.3070, up from a session low of 1.3058, and off from a high of 1.3140.

The pair was likely to find support at 1.3017, Monday's low, and resistance at 1.3140, the earlier high.

Eurozone retail sales increased 0.1% in November, according to Eurostat, the European Union's statistics office, falling short of market expectations for a 0.3% rise, which pushed the pair downward.

The single currency also softened after official data revealed that the unemployment rate in the currency bloc hit a record high of 11.8% in November, in line with market expectations and up from 11.7% in October, which further quelled appetite for risk.

Elsewhere in Germany, the government reported that factory orders fell 1.8% in November, outpacing market expectations for a 1.4% decline thanks in part to slumping overseas demand for the country's goods and services.

Disappointing data offset news that the European Stability Mechanism, the currency's zone's permanent bailout fund, sold EUR1.92 billion in short-term debt earlier Tuesday.

Japanese Finance Minister Taro Aso said his government would buy euro-denominated debt issued by the ESM to help prop up the economy in Europe, a key export market, though investors opted for the dollar over the euro.

Market chatter that credit ratings agencies may downgrade France kept the euro in negative territory against the greenback earlier even though Paris dismissed such talk.

The euro, meanwhile, was up against the pound and down against the yen, with EUR/GBP trading up 0.09% at 0.8146, and EUR/JPY trading down 1.01% at 113.99.

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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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