Euro is heading a little bit lower, slipping as eurozone data disappoints, and as the Spanish bond auction doesn’t go as well as hoped. After hitting a seven-week high against the US dollar, the 17-nation currency is now pulling back.
Once again, signs are evident that the eurozone economy is in contraction. Earlier, the euro gained ground on the expectation that the contraction was slowing a little bit, but disappointments have been the order of the day, and the euro has turned to retreat.
Eurozone retail sales for October, along with other data, accelerated some of the sour sentiment, with a sharper pull back than expected. It appears that the 17-nation currency region won’t be able to rely on consumers to help pull out of the current fund.
Another problem is that the Spanish bond auction didn’t go as well as hoped. With the auction not seeing as much demand as thought, there are new concerns that a bailout will be needed for Spain. A conditional bailout has been suggested for the country, but Spanish politicians have so far been reluctant to get help from the ECB and IMF, since they don’t want to deal with the austerity measures.
At 13:55 GMT EUR/USD is down to 1.3067 from the open at 1.3094. EUR/GBP is down to 0.8120 from the open at 0.8135. EUR/JPY is a little higher at 107.2800, up from the open at 107.2350.
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