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Forex - EUR/USD holds steady in quiet post-Christmas trade

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Investing.com - Investing.com - The euro was little changed against the U.S. dollar in light holiday trade on Wednesday, as investors were hesitant to make big bets amid ongoing uncertainty U.S. lawmakers will reach a deal to avoid the looming fiscal cliff crisis.

Trading was expected to remain subdued as holidays in many countries limit activity.

EUR/USD hit 1.3221 during early U.S. morning trade, the session high; the pair subsequently consolidated at 1.3197, easing up 0.03%.

The pair was likely to find support at 1.3144, the low of December 17 and resistance at 1.3238, the high of December 21.

Market players remained focused on developments surrounding the fiscal cliff in the U.S., approximately USD600 billion in automatic tax hikes and spending cuts due to come into effect on January 1.

President Barack Obama, currently vacationing in Hawaii, plans to return to Washington on Thursday in order to take part in talks to avert the crisis ahead of the year-end deadline, the White House said late Tuesday.

Both chambers of Congress are also due to return to work on Thursday.

Without a deal, the U.S. could fall back into recession and drag much of the world down with it.

The U.S. is to publish industry data on house price inflation as well as a report on manufacturing activity in Richmond later in the trading day.

Elsewhere, the euro rallied to a 16-month high against the broadly weaker yen with EUR/JPY up 0.64%, to hit 112.68, the highest level since August 2011.

Markets in Europe remained closed Wednesday for the Boxing Day holiday.

Volumes are expected to remain light because many investors have closed books to lock in profit before the end of the year, reducing liquidity in the market and increasing the volatility.

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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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