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Forex - EUR/USD pares losses after disappointing U.S. data

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Shutterstock photo - - The euro pared losses against the U.S. dollar on Friday, pulling away from 11-year lows after the release of disappointing U.S. housing and manufacturing data, while markets were still digesting the European Central Bank's announcement of a large scale stimulus program.

EUR/USD eased off 1.1118, the lowest since September 2003, to hit 1.1247 during U.S. morning trade, still down 1.02%.

The pair was likely to find support at 1.0762 and resistance at 1.1647, Thursday's high.

In a report, the National Association of Realtors said that U.S. existing home sales rose by 2.4% in December to 5,040 million units from a revised total of 4,920 million units in November. Analysts had expected existing home sales to hit 5,060 million units last month.

Separately, research firm Markit said the U.S. flash manufacturing purchasing managers' index fell to 53.7 this month from 53.9 in December, disappointing expectations for a rise to 54.0.

The euro found some support after a report on Friday showed that the Markit preliminary composite PMI, which measures activity in the manufacturing and services sectors in the euro area, rose to 52.2 this month from a reading of 51.4 in December.

Analysts had expected the index to rise to 51.8 in January.

In Germany, the preliminary manufacturing PMI ticked down to 51.0 this month from 51.2 in December, compared to expectations for a rise to 51.7, while the preliminary services PMI rose to 52.7 in January from 52.1 the previous month, exceeding expectations for a rise to 52.5.

Markit also said that France's preliminary manufacturing PMI rose to 49.5 this month from 47.5 in December, beating expectations for a rise to 48.1, while the services PMI fell to 49.5 in January from a reading of 50.6 the previous month, confounding expectations for an increase to 50.7.

But the single currency remained under broad selling pressure after ECB President Mario Draghi announced on that the bank will make monthly purchases of €60 billion per month, starting in March and continuing until late 2016.

Draghi acknowledged the action the ECB took last year was "insufficient" to ward off the threat of deflation in the region.

The euro was also sharply lower against the pound, with EUR/GBP tumbling 1.02% to 0.7493, holding above a seven-year trough of 0.7428 hit earlier in the session.

In the U.K., the Office for National Statistics reported on Friday that retail sales rose 0.4% in December, beating expectations for a 0.6% decline, after a 1.6% increase the previous month.

Year-on-year, retail sales increased by 4.3% last month, more than the expected 3.0% rise, after a 6.4% advance in November. offers an extensive set of professional tools for the financial markets.

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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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