EUR/USD slightly lower, but still supported after Bernanke’s statement

The euro edged lower against the US dollar on Friday, but still demand for the greenback was under pressure, following Ben Bernankes statement on Wednesday.

EUR/USD fell down to a session low at 1.3072 at 5:22 GMT, after which consolidation followed at 1.3077. The cross was down by 0.14% for the day. Support was likely to be found at July 11th low, 1.3007, while resistance was expected at July 10th high, 1.3206.

US dollar took a sharp fall against its major peers after on Wednesday Federal Reserve Bank Chairman Ben Bernanke said, that central bank’s policy should remain accommodative, even after the minutes of FED’s June meeting revealed that there were debates, regarding a possible exit to the stimulus program. According to FED minutes, half of the 19 members of FOMC voted in favor of terminating monthly asset purchases by the end of this year. However, some policymakers were not convenient with this idea, because, in their view, US labor market was in need of further improvement.

Additionally, on Thursday it became clear that the number of people, who filed for unemployment assistance in the United States unexpectedly rose by 16 000 to 360 000 during the week ended on July 6th 2013, opposing expectations of a drop by 4 000 to 340 000.

Meanwhile, sentiment on the euro was influenced after the European Central Bank’s monthly bulletin said on Thursday that the extended period of time the bank expected interest rates to remain at present or lower levels was flexible and further rate cuts were possible.

Later on Friday separate reports will show consumer price inflation in Italy and Spain, followed by Euro zones industrial production. On the other hand, the United States will release reports on producer price inflation and the preliminary estimate of University of Michigan Confidence index.

Ultimately, the euro was little changed against the British pound, as EUR/GBP cross increased by a mere 0.06% to 0.8631 at 6:55 GMT.