Forexpros – The euro fell to a two-day low against the pound on Wednesday, as downbeat euro zone industrial orders and manufacturing data added to concerns over the region’s grim economic outlook.
EUR/GBP hit 0.8604 during European morning trade, the pair’s lowest since November 21; the pair subsequently consolidated at 0.8610, declining 0.31%.
The pair was likely to find support at 0.8571, the low of November 4 and resistance at 0.8664, Tuesday’s high.
Official data showed that industrial orders in the euro zone fell significantly more-than-expected in September, dropping 6.4% outstripping expectations for a 2.7% decline.
Earlier in the day, preliminary data showed that the euro zone’s manufacturing purchasing managers’ index slumped to a 28-month low November, falling to 46.4, down from 47.1 in October.
Manufacturing output in Germany dropped to a 28-month low of 47.9, underlining fears that the euro zone could be slipping into a recession.
Meanwhile, service sector activity in the euro zone improved slightly, but remained in contraction territory for the third consecutive month in November.
The single currency came under pressure earlier amid speculation that France’s triple A credit rating might be in danger after a Belgian newspaper report that Belgium and France were in fresh talks over an existing bailout plan for troubled lender Dexia.
In the U.K., the minutes of the Bank of England’s November policy meeting showed that policymakers saw little merit in “fine tuning” their stimulus program and voted unanimously to maintain the central bank’s key interest rate at 0.5% and the size of its asset purchase program at GBP275 billion.
The pound was lower against the U.S. dollar as GBP/USD hit 1.5557, falling 0.47%.
Later in the day, the U.S. was to publish a string of economic data ahead of Thursday’s Thanksgiving holiday, including a government report on durable goods orders, the weekly report on initial jobless claims as well as data on crude oil stockpiles, inflation, personal income and personal spending.
Meanwhile, the University of Michigan was to release revised data on inflation expectations and consumer sentiment.
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