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Forex - EUR/USD hits 3-day high as risk sentiment improves

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Forexpros - The euro edged higher against the U.S. dollar on Monday, climbing to a three-day high as better-than-expected Japanese economic data and strong U.S. retail sales data helped ease fears over the global economy.

EUR/USD hit 1.4328 during late Asian trade, the pair's highest since August 10; the pair subsequently consolidated at 1.4322, gaining 0.51%.

The pair was likely to find support at 1.4102, the low of August 11 and resistance at 1.4425, the high of August 8.

Preliminary data released earlier in the day showed that Japan's economy contracted by 0.3% in the second quarter, or 1.3% on an annualized basis.

Analysts had expected Japan's economy to contract by 0.9% in the quarter, or 2.5% on an annualized basis.

Meanwhile, government data released Friday showed that U.S. retail sales rose by 0.5% in July, the biggest gain in four months.

Markets were also awaiting Tuesday's meeting between German Chancellor Angela Merkel and French President Nicolas Sarkozy, to further asses the region's debt crisis and how officials plan to handle escalating contagion threats.

European Union Economic and Monetary Commissioner Olli Rehn said in an interview Monday that Italy, Spain and France will not need financial bailouts, as these countries are taking "the right steps" to balance their budgets.

Elsewhere, the euro was also up against the pound, with EUR/GBP adding 0.5% to hit 0.8798.

Later in the day, the U.S. was to produce official data on manufacturing activity in New York State and a report on the balance of domestic and foreign investment in the U.S.

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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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