Forexpros – The euro trimmed back losses against the pound on Monday, easing off a six-month low amid speculation that the European Central Bank was buying Spanish and Italian government debt.
EUR/GBP pulled away from 0.8532, the pair’s lowest since March 3, to hit 0.8592 during European morning trade, down just 0.04% on the day.
The pair was likely to find support at 0.8458, the low of March 1 and resistance at 0.8655, the high of March 11.
The single currency was pressured lower earlier after media outlets reported that Germany’s government has planned to firewall the country’s banking sector in the event that Greece is forced to default on its debts.
Earlier Monday, Greece’s deputy finance minister said the country has cash to operate until next month.
Meanwhile, last week’s resignation of European Central Bank governing council member Juergen Stark, amid reported disagreements over the bank’s bond buying program, highlighted divisions among senior policymakers over the handling of the region’s debt crisis.
The euro remained supported amid speculation that the ECB was buying Spanish and Italian government debt, in order to keep borrowing costs for the two countries at affordable levels.
Elsewhere, the euro remained lower against the U.S. dollar, with EUR/USD shedding 0.31% to hit 1.3609.
Later Monday, German Chancellor Angela Merkel was to hold talks on the euro zone debt crisis with European Commission President Jose Manuel Barroso.
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