Forexpros – The euro was hovering just below a two-week high against the pound on Monday, as sustained concerns over financial turmoil in Greece and Spain weighed on demand for the single currency.
EUR/GBP hit 0.8089 during European morning trade, the pair’s highest since May 5; the pair subsequently consolidated at 0.8073, slipping 0.06%.
The pair was likely to find support at 0.8024, the low of May 18 and short-term resistance at 0.8089, the session high.
The euro found some support after a weekend summit of the G8 nations saw leaders affirm that they want Greece to remain in the euro zone, but leaders failed to reach an agreement on how to calm market turmoil stemming from the crisis in the region.
Concerns over political turmoil in Greece also eased after opinion polls indicated that pro-bailout party, New Democracy was leading the polls ahead of fresh elections, due to be held on June 17.
However, investors remained wary amid fears over the implications of a Greek exit from the euro area, while concerns over the health of Spain’s banking sector also weighed.
Demand for the pound remained weaker after last week’s Bank of England inflation report warned of the risk to the U.K. economic recovery stemming from the euro zone crisis and sparked speculation over the possibility of fresh easing measures from the central bank.
The euro was fractionally lower against the U.S. dollar, with EUR/USD dipping 0.04% to hit 1.2774, but pushed higher against the yen, with EUR/JPY adding 0.31% to hit 101.29.
Markets were looking ahead to a first meeting between German Finance Minister Wolfgang Schaeuble and his newly appointed French counterpart, Pierre Moscovici, later in the day, as European Union leaders prepared for Wednesday’s summit meeting.
Forexpros
