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Forex - EUR/USD near session lows after Italian auction, EZ data

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Investing.com - The euro was trading close to session lows against the dollar on Wednesday after Italy saw borrowing costs rise at an auction of government bonds, while worse-than-expected data on euro zone industrial production also weighed.

EUR/USD hit 1.3010 during European morning trade, the session low; the pair subsequently consolidated at 1.3021, slipping 0.10%.

The pair was likely to find support at 1.2978, the low of March 11 and resistance at 1.3100, the high of March 1.

Italy saw the yield on three-year bonds rise to the highest level since December at the first auction of the country's debt since a one-notch downgrade by Fitch's ratings agency last week in the wake of inconclusive elections.

Italy's Treasury sold EUR3.32 billion worth of three-year government bonds at an average yield of 2.48%, up from 2.30% at a similar auction last month.

The yield on the 15-year bond rose to 4.90% from 4.80% in January.

Following the auction, the yield on Italian 10-year bonds ticked up to 4.68%.

Elsewhere, Eurostat said industrial production in the euro zone fell 0.4% in January from December, more than expectations for a 0.1% decline.

The weaker-than-expected data reinforced concerns over the economic outlook for the region.

The euro hit session lows against the pound and the yen, with EUR/GBP down 0.54% to hit 0.8697 and EUR/JPY falling 0.39% to 124.72.

Investors were looking ahead to U.S. data on retail sales later in the trading day as demand for the dollar continued to be underpinned by optimism that the economic recovery in the U.S. is gaining traction.

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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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