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Forex - EUR/USD rises to session high, gains seen limited

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Investing.com - The euro rose to session highs against the dollar on Monday, as traders booked profits following the dollar's recent rally, but gains looked set to remain limited amid expectations that the Federal Reserve will soon start to unwind stimulus measures.

EUR/USD hit 1.2875 during U.S. morning trade, the session high; the pair subsequently consolidated at 1.2862, rising 0.23%.

The pair was likely to find support at 1.2750, the low of March 27 and resistance at 1.2875.

Demand for the dollar continued to be underpinned after official data on Friday showed that the U.S. economy added 195,000 jobs in June, more than the 165,000 increase forecast by economists.

May's figure was revised up to 195,000 from a previously reported 175,000. The unemployment rate remained unchanged at 7.6% in June.

Fed Chairman Ben Bernanke said last month the bank could begin tapering its USD85 billion-a-month asset purchase program by the end of 2013 if the economy picks up as the central bank expects.

The single currency remained under pressure after European Central Bank President Mario Draghi said last week that the bank expects to maintain interest rates at current or lower levels for an "extended" period of time.

In Germany, official data showed that industrial production fell 1% in May, compared to expectations for a 0.5% decline.

A separate report showed that Germany posted a smaller-than-expected trade surplus of EUR14.1 billion in May, as exports decreased by 4.8% on a year-over-year basis and imports fell by 2.6%.

Analysts had expected a trade surplus of EUR17.5 billion.

Elsewhere, the euro was little changed against the pound, with EUR/GBP edging up 0.02% to 0.8615 and was higher against the yen, with EUR/JPY rising 0.17% to 130.01.

The eurogroup of euro zone finance ministers were to hold talks in Brussels later Monday.

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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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