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Forex - EUR/USD lower as Franco-German summit disappoints

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Forexpros - The euro edged lower against the U.S. dollar on Wednesday, as the previous day's meeting between German Chancellor Angela Merkel and French President Nicolas Sarkozy failed to ease concerns over the euro zone's ongoing sovereign debt crisis.

EUR/USD hit 1.4350 during late Asian trade, the daily low; the pair subsequently consolidated at 1.4388, shedding 0.12%.

The pair was likely to find support at 1.4250, the low of August 15 and short-term resistance at 1.4476, the high of August 15 and a three-week high.

German Chancellor Angela Merkel and French President Nicolas Sarkozy proposed a new council to improve the governance of the euro zone.

The two leaders recommended that current European Council President Herman van Rompuy lead the new council, which would meet at least twice a year.

Merkel and Sarkozy also planned to introduce a financial transaction tax in September as well as a new measure to require all 17 euro zone member states to reduce their deficits before the summer of 2012, the Wall Street Journal said.

But the two leaders fell short of increasing the region's bailout fund, which many feel is inadequate should the debt crisis spread to Italy, Spain or France.

They also rejected issuing euro bonds, saying that the bonds will not solve the bloc's debt issues, disappointing investors who had been anticipating such an action.

Elsewhere, the euro was fractionally lower against the pound, with EUR/GBP slipping 0.04% to hit 0.8749.

Later in the day, the euro zone was to release official data on consumer price inflation, as well as data on the region's current account.

Meanwhile, the U.S. was to publish official data on producer price inflation, as well as government data on crude oil stockpiles.

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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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