Forexpros – The euro was higher against most of its major counterparts on Wednesday, after data showed that a contraction in manufacturing activity in the single currency bloc slowed in January, while fresh hopes on a debt deal for Greece also lent support.
During European late morning trade, the euro was up against the U.S. dollar, with EUR/USD rising 0.37% to hit 1.3132.
The euro was boosted after data showed that the euro zone’s manufacturing purchasing managers’ index rose to 48.8 from an earlier estimate of 46.9 in December, but the data showed that only Germany registered a reading above 50, indicating expansion.
Meanwhile, preliminary data showed that the rate of consumer price inflation in the euro zone eased to 2.7% in December from 2.8% the previous month, giving the European Central Bank more leeway to cut rates.
Also Wednesday, Greek newspaper Kathimerini reported that the head of the International Monetary Fund mission to Athens said talks on a new loan program for the country will conclude within a matter of days.
Earlier in the week, Greek officials indicated that separate negotiations with the country’s private creditors were very close to being concluded, but concerns have persisted that the debt swap deal will not go far enough to reduce the country’s debt load.
The euro was also higher against the pound, with EUR/GBP adding 0.41% to hit 0.8336.
In the U.K. a report earlier showed that the manufacturing sector expanded at the fastest pace in eight months in January, as output grew at the fastest rate in 10 months and new orders rose.
The euro edged higher against the yen, with EUR/JPY easing up 0.11% to hit 99.89.
Elsewhere, the single currency was trading close to the minimum exchange rate cap of 1.20 against the Swiss franc, with EUR/CHF inching up 0.05% to hit 1.2044, amid mounting speculation over a fresh intervention by the Swiss National Bank.
Official data released earlier Wednesday showed that Swiss retail sales rose less-than-expected in December, while manufacturing activity unexpectedly contracted in January, underlining expectations for weak growth in the Swiss economy in the coming months.
The euro continued to struggle close to record lows against the Australian and New Zealand dollars, with EUR/AUD slipping 0.10% to hit 1.2305 and EUR/NZD dipping 0.01% to hit 1.5822.
In a speech earlier, Australian Prime Minister Julia Gillard warned exporters that the high level of the domestic currency was likely to continue in the long term.
The euro was fractionally higher against the Canadian dollar, with EUR/CAD inching up 0.04% to hit 1.3122.
Later in the day, the U.S. was to release a report on ADP non-farm payrolls, as well as a data from the Institute for Supply Management on manufacturing sector activity.
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