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Forex - EUR/USD edges lower ahead of E.Z. data, ECB

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Investing.com -

Investing.com - The euro edged down against the U.S. dollar on Wednesday, still hovering close to three-and-a-half month lows as markets were jittery ahead of euro zone service sector data due later in the day, as well as Thursday's policy statement by the European Central Bank.

EUR/USD hit 1.3608 during late Asian trade, the session low; the pair subsequently consolidated at 1.3611, slipping 0.12%.

The pair was likely to find support at 1.3553, the low of February 7 and resistance at 1.3668, the high of May 27.

The single currency had strengthened mildly on Tuesday, after data showed that the unemployment rate in the single currency bloc ticked down to 11.7% in April, from 11.8% the previous month, confounding expectations for the rate to remain unchanged.

But sentiment on the euro remained vulnerable after Eurostat said consumer price inflation in the euro zone increased by 0.5% last month, down from 0.7% in April and missing expectations for a reading of 0.7%.

The rate stands well below the ECB target of near but just under 2% and the report added to expectations that the ECB will take steps to tackle low consumer price growth, which is threatening the fragile recovery in the euro zone.

Meanwhile, the greenback found some support after official data on Tuesday showed that U.S. factory orders rose 0.7% in April, beating expectations for a 0.5% gain, after an upwardly revised 1.5% increase in March.

The euro was fractionally higher against the pound, with EUR/GBP edging up 0.09% to 0.8143.

Later in the day, the U.S. was to release the ADP report on private sector job creation, as well as a report on trade balance.

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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.

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