Invesing.com - The euro pushed higher against the dollar on Wednesday, backing off the five-week lows struck in the previous session but gains looked likely to remain limited amid heightened expectations for monetary easing by the European Central Bank.
EUR/USD was trading at 1.3721, up 0.15% for the day after falling to lows of 1.3688 late Tuesday, the weakest since April 4.
The pair is likely to find support at 1.3688 and resistance at 1.3770, Tuesday’s high.
The latest drop in the euro came after reports on Tuesday that Germany’s Bundesbank is open to more stimulus measures from the ECB.
The Wall Street Journal reported the German central bank would back monetary easing measures if they were needed to keep persistently low levels of inflation from becoming entrenched in the euro zone.
The euro came under heavy selling pressure after the ECB indicated late last week that it is “comfortable” with acting at its next meeting in June after it has a chance to review the latest economic projections.
The euro was flat against the yen, with EUR/JPY at 140.13, not far from last Friday’s two-month trough of 139.87.
The single currency slumped to fresh 16-month lows against sterling, with EUR/GBP sliding 0.10% to 0.8136.
Investors were looking ahead to the latest U.K. jobs data and the Bank of England’s quarterly inflation report later in the session, for indications on the possible timing of a rate hike.
Elsewhere, the dollar slipped lower against the yen, with USD/JPY easing 0.13% to 102.14.