Forexpros – The euro extended losses against the U.S. dollar on Tuesday, falling to a two-day low amid renewed concerns over the sovereign debt crisis in the 17-nation shared currency bloc.
EUR/USD hit 1.4385 during European early afternoon trade, the pair’s lowest since Friday; the pair subsequently consolidated at 1.4409, shedding 0.69%.
The pair was likely to find support at 1.4330, Friday’s low and resistance at 1.4532, the days high.
Sentiment on the euro was hit as German Chancellor Angela Merkel faced increasing parliamentary opposition to a planned expansion of the powers of the euro zone’s bailout fund, the European Financial Stability Facility.
Elsewhere, Italy’s Treasury auctioned EUR7.7 billion of bonds earlier, with the yield on 10-year notes falling to 5.22%, compared to a yield of 5.77% at an earlier auction in July.
Meanwhile, on Monday European Central Bank President Jean-Claude Trichet said that growth in the euro zone could be weaker than expected in the months ahead, indicating that the central bank may keep interest rates on hold for the rest of this year.
The euro was also lower against the pound, with EUR/GBP shedding 0.15% to hit 0.8829.
Later in the day, the U.S. was to release data on consumer confidence as well as an industry report on house price inflation. In addition, the Federal Reserve’s Open Market Committee was to publish the minutes of its August rate-setting meeting.
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