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Forex - EUR/USD hits session highs after Spanish bond auction

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Investing.com - The euro rose to session highs against the U.S. dollar on Thursday, after Spain saw borrowing costs fall at an auction of five-year government bonds while investors anticipated a European Central Bank policy meeting later in the day.

EUR/USD hit 1.3106 during European morning trade, the pair's highest since Tuesday; the pair subsequently consolidated at 1.3100, gaining 0.27%.

The pair was likely to find support at 1.2996, the low of January 4 and resistance at 1.3118, the high of January 7.

Spain's Treasury sold EUR5.8 billion worth of debt, above the full targeted amount of EUR5 billion, with the yield on five-year bonds down to 3.99% from 4.20% at an auction last week.

Meanwhile, Italy saw borrowing costs fall to the lowest level since January 2010 at an auction of 12-month government bonds.

The euro's gains were limited as investors looked ahead to the outcome of the ECB's policy meeting later Thursday.

The ECB was widely expected to hold off cutting rates, but some market participants expected President Mario Draghi to flag the possibility of rate cuts later in the year.

The euro was higher against the pound, with EUR/GBP up 0.17% to 0.8167 and was trading close to 18-month highs against the yen with EUR/JPY rising 0.57% to 115.46.

The U.S. was to release the weekly government report on initial jobless claims later in the trading day.

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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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