Forexpros – The euro was trading close to a 21-month low against the U.S. dollar on Wednesday, amid growing skepticism that a European Union summit later in the day would result in fresh measures to stem the crisis in the euro zone.
EUR/USD hit 1.2615 during European afternoon trade, the pair’s lowest since August 25, 2010, the pair subsequently consolidated at 1.2657, shedding 0.21%.
The pair was likely to find support at 1.2522, the low of August 25, 2010 and resistance at 1.2687, the session high.
Investor sentiment weakened amid concerns over a division between France’s new President Francois Hollande, who favors measures designed to support growth and pro-austerity Germany, ahead of the European leaders meeting in Brussels.
Sentiment on the euro was hit earlier by renewed fears over a Greek exit from the euro area after comments from former Greek Prime Minister Lucas Papademos appeared to indicate that preparations for an exit scenario were being made.
Though Papademos later clarified the remarks, saying there are no preparations under way in Greece for a possible euro area exit, markets remained risk adverse.
The euro was little changed against the pound, with EUR/GBP dipping 0.01% to hit 0.8046, but fell to a more-than two-month low against the yen, with EUR/JPY tumbling 0.91% to hit 100.47.
Later in the day, the U.S. was to release industry data on existing home sales.
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