RTTN: Euro Recovers From Multi-day Lows Against Majors On Euro-zone Inflation Data
(RTTNews) - The euro that declined in early Monday Asian deals amid rising political tensions in Egypt recouped its losses in the latter part of the session and strengthened further during early European trading as a report showed that the eurozone inflation accelerated more than expected in December.
Eurozone inflation rose to 2.4% in January from 2.2% recorded in December, flash estimate from the Eurostat showed on Monday. Consumer prices rose more than the expected increase of 2.3%.
In December, Eurozone annual inflation hit 2.2%, breaching the European Central Bank's target for the first time in more than two years. The ECB has an inflation target of "below, but 2% over the medium term".
In a separate report, German retail sales dropped 0.3% month-on-month in December following the revised 1.9% decline in November, the Federal Statistical Office said today. That was in contrast to economists' forecast for a 2.2% rise.
On an annual basis, retail sales dropped 1.3% in December, reversing a 2.6% gain in the preceding month. Annual figure also missed expectations for an increase of 1.1%.
In the equity front, the European stock markets are trading in a negative territory as investors fear the ongoing tensions in Egypt may interrupt oil supply through the Suez Canal.
U.K.'s FTSE 100 Index is currently down 0.3 percent, France's CAC 40 is trading lower at 0.34 percent and Germany's DAX is currently down 0.33 percent.
The euro that slipped to an 11-day low of 111.43 against the yen in the Asian session recovered in early trading to reach as high as 112.35 around 5:35 am ET. On the upside, the euro-yen pair may target resistance around the 113.60 level. The pair finished last week's deals at 111.83.
The euro that slipped to a 2-week low of 1.2783 against the Swiss franc in early Monday Asian deals reversed its course in early European trading. The euro-franc pair is presently quoted at 1.2881, up from 1.2830 hit late New York Friday.
The common currency also advanced from a 1-week low of 1.3572 against the US dollar and a 6-day low of 0.8566 in early European trading on Monday. The euro that finished Friday's deals at 0.8586 against the pound and 1.3617 versus the greenback is presently quoted at 0.8594 and 1.3640, respectively.
Traders are looking for more clues this week as they expect crucial data on European Central Bank decision on Thursday and the U.S. non-farm payrolls data on Friday.
Looking ahead, the U.S. personal income & outlays report for December and the results of the Institute of Supply Management-Chicago's business survey for January are expected to influence trading in the upcoming hours.
