Forexpros – The euro was lower against the U.S. dollar on Monday, amid speculation over a possible downgrade of the euro zone’s sovereign debt by Standard &Poor’s after the European Union agreed on tighter fiscal integration on Friday, but fell short of securing a treaty change.
EUR/USD hit 1.3309 during late Asian trade, the daily low; the pair subsequently consolidated at 1.3313, shedding 0.53%.
The pair was likely to find support at 1.3258, the low of November 30 and resistance at 1.3381, the session high.
With the exception of the U.K., EU leaders agreed to implement stricter budgetary rules across the euro zone and to provide EUR200 billion in loans to the International Monetary Fund to assist countries with debt problems.
But uncertainty over whether the European Central Bank will now play a bigger role in stabilizing the region’s bond market kept investors on edge.
Last week S&P placed the credit ratings of 15 euro zone members, including France, Germany, Italy and Spain on negative watch and said it would announce any ratings changes “as soon as possible” after Friday’s summit.
The euro also slipped against the pound, with EUR/GBP sliding 0.11% to hit 0.8530.
Earlier Monday, ratings agency Moody’s warned that the debt crisis was still in a “critical” and “volatile” stage, adding that the region still faced increasing risks to cohesion.
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