Forexpros – The Australian dollar was steady against its U.S. counterpart on Monday, as investors remained cautious amid uncertainty over the effectiveness of new measures to tackle the euro zone’s debt crisis.
AUD/USD hit 1.0215 during late Asian trade, the daily low; the pair subsequently consolidated at 1.0231, easing 0.05%.
The pair was likely to find support at 1.0132, the low of June 20 and resistance at 1.0334, the high of May 3.
The Aussie found strong support after European Union leaders agreed on Friday to use the euro zone’s bailout funds to support struggling banks directly, without adding to national debt and also agreed to set up a joint banking supervisory body for the euro area.
In addition to the direct recapitalization of Spain’s banks, euro zone bailout funds will be able to purchase government debt in order to keep down borrowing costs.
EU leaders also agreed to devote EUR120 billion in stimulus to encourage growth and create jobs.
But market sentiment cooled on Monday, as details about how and when European leaders can put the newly agreed measures into practice still remained uncertain.
Investors were also eyeing the outcome of the European Central Bank’s policy meeting on Thursday, amid growing expectations for a rate cut to support the faltering economy.
Elsewhere, the Aussie was higher against the euro with EUR/AUD shedding 0.21%, to hit 1.2341.
Later in the day, the U.S. Institute for Supply Management was to release a report on activity in the manufacturing sector.
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