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Forex - EUR/USD gains on advancing German factory orders

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Investing.com - Better-than-expected Germany factory orders coupled with an International Monetary Fund decision to hike growth forecasts for Europe's largest economy sent the euro gaining against the dollar on Tuesday.

In U.S. trading on Tuesday, EUR/USD was up 0.36% at 1.3305, up from a session low of 1.3233 and off from a high of 1.3323.

The pair was likely to find support at 1.3190, Friday's low, and resistance at 1.3345, Wednesday's high.

Earlier Tuesday, official data revealed that German factory orders rose by 3.8% in June, surpassing market consensus forecasts calling for a 1.0% gain.

Orders within the euro zone rose 10% last month, while sales outside of the single currency block rose by just 0.9%.

The data gave the euro support on hopes better days lie ahead for the euro zone economy, as did an upward revision to the German economy from the International Monetary Fund.

The multilateral lending institution hiked its German growth forecast to 1.4% in 2014 from a previous 1.3% forecasts and maintained its 2013 growth forecast at 0.3% in its annual report on the country.

Elsewhere in Europe, a separate report showed that Italy's economy contracted less than forecast at 0.2% in the second quarter compared with expectations for a 0.4% contraction, indicating that the euro zone's third largest economy may be stabilizing.

Meanwhile in the U.S., the Commerce Department reported earlier Tuesday that the U.S. trade deficit narrowed by 22.4% to USD34.2 billion from a USD44.1 billion deficit in May.

Analysts were expecting the U.S. trade deficit to narrow to USD43.5 billion in June.

The data showed that U.S. exports rose 2.2% in June to USD191.2 billion, while imports fell 2.5% to USD225.4 billion as petroleum imports declined sharply.

The euro, meanwhile, was up against the pound and down against the yen, with EUR/GBP trading up 0.24% at 0.8654 and EUR/JPY trading down 0.21% at 130.03.

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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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