Investing.com - The euro slid against the dollar on Tuesday after data revealed more U.S. consumers are confident on the economy than expected while dovish language from a high-ranking European Central Bank official softened the euro as well.
In U.S. trading, EUR/USD was down 0.49% at 1.3772, up from a session low of 1.3749 and off a high of 1.3847.
The pair was likely to find support at 1.3707, the low from March 4, and resistance at 1.3876, Monday''s high.
ECB governing council member and Bundesbank chief Jens Weidmann said earlier that a negative deposit rate may ensure the euro remains in comfort zones.
Weidmann added he couldn''t rule out fresh ECB purchases of loans and other assets to ward off deflation if necessary, indicating a softening of Germany''s stance on monetary stimulus tools.
Separately, ECB Governing Council member Josef Makuch said the bank is prepared to take decisive steps if necessary, adding that many policy options are available, including adding liquidity.
Elsewhere, the euro came under added pressure after a report showed that the German Ifo business confidence index dropped to 110.7 in March from 111.3 in February, missing analysts'' calls for a 111.0 reading.
The expectations component of the index weakened as concerns over the impact of the Crimea crisis weighed, but the current assessment component continued to improve, rising to the highest level since April 2012.
Meanwhile in the U.S., strong consumer confidence data bolstered the dollar despite spotty housing indicators.
The Conference Board reported that its consumer confidence index increased to 82.3 this month, the highest since January 2008, from 78.3 in February. Analysts had expected the index to tick up to 78.6.
The report showed that consumers expect the economy to continue improving and believe it may gather momentum in the coming months.
Separately, the Commerce Department said new home sales fell by the most in five months in February, indicating headwinds still face the housing sector.
Sales of new homes fell by 3.3% in February to 440,000 units, the weakest level since last September. Still, analysts were calling for a decline of 4.9%.
January''s sales were revised down to a 455,000-unit pace from the previously reported 468,000-unit rate.
Also on Tuesday, a report on U.S. housing showed that prices rose slightly less than expected in January.
The Standard & Poor’s/Case-Shiller home price index rose 13.2% in January from a year earlier, compared to forecasts for a 13.3% gain.
The euro was down against the pound, with EUR/GBP down 0.54% to 0.8343, and down against the yen, with EUR/JPY down 0.49% at 140.81.
On Wednesday in the euro zone, Germany is to release a report on Gfk consumer climate.
The U.S. is to release data on durable goods orders, a leading indicator of production.
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