Euro Declines Against Majors
The euro drifted lower against its major counterparts in early New York deals on Thursday, as continued sell-off in commodities sapped demand for riskier assets, while a decline in Eurozone bond yields weighed.
Crude oil fell below $39 a barrel as the US dollar trended higher and US crude inventories unexpectedly jumped yet again last week, defying speculation that the nation's supply glut may have eased.
Global stocks were under pressure after comments from St. Louis Federal Reserve President James Bullard renewed concerns about the outlook for interest rates.
Bullard said the relatively minor downgrades to the Fed's economic outlook suggest the next rate hike "may not be far off provided that the economy evolves as expected."
The 10-year yields on German bonds fell 0.17 percent, while that of 20-year equivalents were lower by 0.70 percent. Yields move inversely to bond prices.
In its monthly bulletin, the European Central Bank said that euro area economic recovery is set to continue at a moderate pace as global concerns such as the emerging market slowdown and a stronger euro weaken prospects for stronger expansion.
"The economic recovery in the euro area is continuing, albeit with signs of a moderation in growth at the beginning of the year due to a weaker external environment," the bank said.
The currency has been lower in European trading amid falling global stocks.
The euro edged down to a session's low of 1.0874 against the franc, down from Wednesday's closing quote of 1.0901. The euro is seen finding support around the 1.07 region.
The single currency depreciated to an 8-day low of 1.1144 against the dollar, and held steady thereafter. If the euro extends slide, it may locate support around the 1.10 mark.
The 19-nation currency, having climbed to a 15-month high of 0.7946 against the pound at 4:30 am ET, reversed direction and edged down to 0.7890. On the downside, 0.76 is likely seen as the next support level for the euro.
Data from the Office for National Statistics showed that British retail sales declined at a slower than expected pace in February.
Retail sales volume dropped 0.4 percent month-on-month reversing January's 2.3 percent growth. This was slower than an expected 0.7 percent decrease.
Reversing from an early high of 126.15 against the Japanese yen, the euro declined to a 2-day low of 125.38. Continuation of the euro's downtrend may lead it to a support around the 124.00 region.
The euro retreated to 1.4847 against the aussie and 1.6635 against the kiwi, from its early 8-day highs of 1.4926 and 1.6730, respectively. The next possible downside target for the euro may be found around 1.46 against the aussie and 1.64 against the kiwi.
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