Forexpros – The euro was up against the U.S. dollar on Wednesday, trading close to the session high as concerns over Spain eased, but sentiment remained fragile amid concerns that the crisis in the single currency bloc could still worsen.
EUR/USD hit 1.3157 during U.S. morning trade, the pair’s highest since April 5; the pair subsequently consolidated at 1.3142, gaining 0.46%.
The pair was likely to find support at 1.3065, the session low and resistance at 1.3186, the high of March 16.
Market sentiment firmed up as the yield on Spanish 10-year bonds pulled away from four-month highs hit earlier, but investors remained cautious amid concerns about the government’s ability to cut its deficit.
Speaking before the Spanish Parliament earlier, Prime Mister Mariano Rajoy said his country will not require a bailout and that the country’s deficit target remains “unconditional.”
Rajoy said that the government will push forward the program to tackle tax and employment fraud this month, as well as reforms in the banking and healthcare systems and privatizations of public sector assets.
In the U.S., official data showed that import prices rose more-than-expected in March, posting the largest monthly gain since April 2011.
The U.S. Bureau of Labor Statistics said import prices rose by a seasonally adjusted 1.3% in March, above expectations for a 0.8% gain.
Import prices for February were revised to a 0.1% decline from a previously reported increase of 0.4%.
The euro was modestly higher against the pound, with EUR/GBP adding 0.13% to hit 0.8258 and posted strong gains against the yen, with EUR/JPY jumping 0.95% to hit 106.54.
Later in the day, the U.S. was to produce a report on the federal budget balance, while the Federal Reserve was to publish its Beige Book.
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