Investing.com - The euro held steady against the U.S. dollar in subdued trade on Monday, as trading volumes were expected to remain thin with U.K. markets closed for a national holiday, while investors continued to monitor developments in Ukraine.
EUR/USD hit 1.3885 during European afternoon trade, the session high; the pair subsequently consolidated at 1.3876, easing up 0.05%.
The pair was likely to find support at 1.3812, the low of May 2 and resistance at 1.3905, the high of April 11.
The euro shrugged off earlier data showing that the Sentix index of euro zone investor confidence deteriorated unexpectedly this month, falling to 12.8 from a reading of 14.1 in April. Analysts had forecast an increase to 14.2.
A separate report showed that producer prices in the euro zone fell 0.2% in March from a month earlier, and were down 1.6% on a year-over-year basis.
Meanwhile, the European Commission said it expects the region’s economy to continue to recover through 2015, but warned that persistently low levels of inflation and geopolitical tensions with Russia could threaten the recovery.
The EC said the euro zone’s economy will expand 1.2% this year, unchanged from its February forecast and grow 1.7% in 2015, down slightly from 1.8% previously.
The commission cut its forecast for euro zone inflation to 0.8% this year and 1.2% in 2015, down from 1.0% and 1.3% in February.
In the U.S., official data on Friday showed that the economy added 288,000 jobs in April, well above expectations for jobs growth of 210,000, while the unemployment rate dropped to a five-and-a-half year low of 6.3%.
But the dollar remained under pressure, as the report also showed that the labor force participation rate, which measures the proportion of people either working or looking for work, fell and wage growth weakened.
Investors were also eying events in Ukraine, after conflict between the government and pro-Russian separatists grew more widespread over the weekend.
Elsewhere, the euro was higher against the pound, with EUR/GBP adding 0.15% to 0.8231.
Also Monday, the final reading of China’s HSBC manufacturing purchasing managers’ index came in at 48.1, down from a preliminary estimate of 48.3 and missing forecasts for an uptick to 48.4. A reading below 50 indicates a contraction.
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