Euro Slips To Two-Week Low Versus Dollar

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The euro declined against the dollar on Tuesday in New York as global stocks slipped, reducing risk appeal. The euro also backed off a multi-month high against the pound.

The Eurozone economy has broadly stabilized after the crisis, but the situation remains fragile and outlook is uncertain, chairman of the euro group of nations, Luxembourg Prime Minister Jean-Claude Juncker reportedly said Tuesday.

Economic sentiment in the Eurozone rose to its highest level in a year as the economy continues to recover from its worst recession.

The euro fell to a two-week low of 1.4532 against the dollar, moving further from the yearly high from last week. The European currency bounced back slightly later in the morning after a disappointing consumer confidence report in the U.S.

The Conference Board said its consumer confidence index slipped to 53.1 in September from a revised 54.5 in August. Economists had been expecting the index to increase to 57.0 from the 54.1 originally reported for the previous month.

The euro dropped away from a six-month high against the sterling, moving near 0.9130. The 16-member currency had reached 0.9300 earlier in the week.

The latest quarterly national accounts report from the Office for National Statistics showed UK gross domestic product fell 0.6% during the second quarter. This decline was revised up from the preliminary estimate of 0.7%.

The euro remained in a range with the yen, moving near 131.50. The European currency had reached a two-month low of 129.78 earlier this week.

In economic news, the Cabinet Office revealed that Consumer prices declined 2.2% year-over-year in August, further triggering fears of deflation. The result matched forecasts exactly following the 2.2% annual fall in July. However, on a monthly basis, inflation was up 0.3%.

In the Eurozone, the economic sentiment indicator rose to 82.8 in September from 80.8 in August, according to the results of the latest business and consumer survey by the European Commission. That is the highest reading since September 2008. Economists had forecast the index to log 82.5.

(Market News Provided by RTTNews)