Forexpros – The euro traded lower against the U.S. dollar Thursday, after Federal Reserve Chief Ben Bernanke stated that the U.S. economy faced “significant risks”, but held back from indicating that the central bank was prepared to implement any fresh stimulus measures.
EUR/USD pulled back from 1.2625, the pair’s highest since May 23, to hit 1.2548 during U.S. afternoon trade, giving back 0.27%.
The pair was likely to find support at 1.2440, Wednesday’s low and resistance at 1.2687, the high of May 23.
In testimony to a congressional committee in Washington, Bernanke stated that the Fed remained “prepared to take action” to protect the U.S. economy and financial system if stresses on the financial system escalate, but stopped short of indicating what these actions might be.
The single currency advanced to a session high against the greenback earlier after the People’s Bank of China reported it will lower benchmark interest rates, in a bid to bolster growth in the world’s second largest economy and counter the effects of a slowdown in global growth.
In other news, solid demand at an auction of Spanish government debt and fresh hopes that European leaders are stepping up efforts to tackle Spain’s banking crisis also bolstered investor sentiment on the single currency.
Spain’s Treasury successfully sold EUR2.07 billion of bonds, slightly more than the targeted amount, in an auction which met with solid investor demand, but saw borrowing costs rise.
The euro was down against the pound, with EUR/GBP falling 0.57% to hit 0.8074, but remained higher against the yen, with EUR/JPY adding 0.34% to hit 99.97.
Earlier Thursday, the U.S. Department of Labor said the number of people who filed for unemployment assistance last week fell by 12,000 to a seasonally adjusted 377,000, in line with expectations.
The previous week’s figure was revised up to 389,000 from a previously reported 383,000.
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