Forexpros – The euro moved lower against the U.S. dollar in Asian trade Friday, following the release of encouraging U.S. labor data and a German vote to expand the European rescue fund.
EUR/USD hit 1.3576 in early Asian trade, the pair’s lowest since Thursday; the pair subsequently consolidated at 1.3580, falling 0.13%.
The pair was likely to find support at 1.3377, the low of January 19, and resistance at 1.3798, last Thursday’s high.
On Thursday, German lawmakers voted to approve an expansion of the European Financial Stability Facility, with only 85 of 523 legislators opposing the vote.
The number of opposing votes from within Chancellor Angela’s Merkel’s center-right coalition, was viewed as a barometer of her strength in negotiating new details of the plan to address Europe’s debt crisis.
Germany became the 13th member of the euro-zone to support expansion of the rescue fund totaling USD600 billion. Cyprus and Estonia also approved the planned expansion on Thursday.
European stocks closed the session mixed; France’s CAC was up 1.07% to 3,027.65, Britain’s FTSE 100 fell 0.40% to 5,196.84, while Germany’s DAX was higher by 1.10% to 5,639.58.
Later in the day, the U.S. Department of Labor released data for the past week, showing that the number of Americans filing for unemployment assistance fell more than expected, to a seasonally adjusted 391,000 from 428,000 the prior week.
Market expectation were for the weekly figure to drop to 420,000.
Wall Street retreated from early session gains to close mixed on Thursday; The Dow Jones Industrial Average rose 1.30% to 11,154.00, the Nasdaq Composite Index fell 0.43% to 2,480.76, while the S&P 500 added 0.81% to 1,160.40.
U.S. stocks were on track to post between a 4% and 5% loss for the month of September and have dropped 10% in the most recent quarter.
Meanwhile, the euro was higher against the British pound but down against the Japanese yen, with EUR/GBP up 0.06% to hit 0.8704, and EUR/JPY lower by 0.09% to hit 104.37.
Austria was scheduled to hold a vote on EFSF expansion later Friday, while the Netherlands was to take up the vote in the first week of October.
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