Forexpros – The euro extended losses against the U.S. dollar on Thursday, falling to a fresh three-week low after data showed that U.S. jobless claims fell less-than-expected last week while concerns over the debt crisis in the euro zone continued to weigh on the single currency.
EUR/USD hit 1.3142 during European afternoon trade, the pair’s lowest since March 15; the pair subsequently consolidated at 1.3053, shedding 0.68%.
The pair was likely to find support at 1.2974, the low of February 16 and a three-week low and resistance at 1.3163, the session high.
The U.S. Department of Labor said the number of individuals filing for initial jobless benefits in the week ending March 31 fell to 357,000, falling short of expectations for a decline to 355,000.
The previous week’s figure was revised up to 363,000 from 359,000.
Jobless claims have remained below 400,000, a level historically associated with an improving labor market, in 21 of the past 23 weeks.
Meanwhile, the euro remained under pressure as Spain’s borrowing costs continued to rise following Wednesday’s poorly received government bond auction. The yield on the country’s 10-year bond climbed to 5.83% earlier, the highest level since mid-December.
Concerns over the outlook for growth in the euro zone also mounted following a recent string of weak economic data.
Earlier Thursday, official data showed that German industrial production dropped 1.3% in February, more than expectations for a 0.5% drop, renewing concerns over the outlook for the bloc’s largest economy.
The data came one day after European Central Bank President Mario Draghi warned that “downside risks to the economic outlook prevail” after the central bank kept its benchmark interest rate unchanged at a record low of 1%.
The euro was also lower against the pound, with EUR/GBP dropping 0.29% to hit 0.8247.
Also Thursday, the Bank of England kept its benchmark interest rate unchanged at a record low 0.5% and announced no change to the size of its asset purchase facility which stands at GBP325 billion, following a GBP50 billion increase in February.
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