On Monday the euro slipped against the U.S. dollar, as Friday's
strong U.S. economic growth report and comments by Fed Chair
Janet Yellen continued to back the greenback, while
markets were eyeing what direction would Greek debt crisis take.
EUR/USD hit 1.0820 during European morning trade, the session low; the pair subsequently consolidated at 1.0853, shedding 0.34%. The pair was likely to find support at 1.0765, the low of March 23 and resistance at 1.1052, the high of March 26.
The dollar strengthened broadly after the Commerce Department reported Friday that the U.S. economy expanded at an annual rate of 2.2% in the fourth quarter, unchanged from the preliminary estimate and below economists’ forecasts for an upward revision to 2.4%.
In addition, Fed Chair Janet Yellen said in a speech on Friday that a rate hike may be warranted later this year, but added that weakening inflation pressures could force the Fed to delay.
Ms. Yellen said policy tightening could "speed up, slow down, pause, or even reverse course" depending on how the economy is performing.
In the euro zone, Greece remained in focus as on Friday Prime Minister Alexis Tsipras’ government put forward new reform plans for approval, as part of a bailout extension review. Representatives of the European Union, the International Monetary Fund and the European Central Bank were to estimate the measures after earlier proposals were not accepted.
Earlier Monday, official figures indicated that consumer prices in Spain fell 0.7% this month, compared to expectations for a decline of 1.0%, after a 1.1% decline in February.
The euro was steady against the pound, with EUR/GBP at 0.7308. On Monday the UK data showed that net lending to individuals and households rose broadly in line with expectations in February, reflecting improving demand for credit.
The Bank of England said total net lending to individuals increased by ₤2.5 billion last month, meeting forecasts and up from ₤2.4 billion in January.
Separate data showed that U.K. mortgage approvals rose to a six-month high last month, indicating that the housing market is picking up.
The U.S. is expected to release final data on fourth
quarter economic growth and the revised reading of the University of
Michigan consumer sentiment index later in the day.
