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The euro showed mixed trading against other major currencies ahead of the London session on Thursday as traders await fresh cues for clear direction.
While the euro gained against the pound, it fell versus the franc. However, the euro changed little against the yen and dollar.
Risk aversion grew yesterday after a report showed that the Eurozone private sector activity unexpectedly slipped back to contraction in February, fueling concerns that the economy may be sliding into a recession amid the region's prolonged debt crisis.
Traders also reacted to news that Fitch Ratings downgraded Greece's credit rating further into junk status. Fitch said a default is highly likely in the near term despite a bailout deal.
The euro that closed Wednesday's European session at 1.2070 against the Swiss franc is currently trading at a fresh 3-week low of 1.2054. If the euro-franc pair weakens further, it may likely target the 1.203 level.
But the euro rose to a fresh 2-month high of 0.8465 against the pound in Asian trading as traders continued selling the pound in response to the Bank of England's February meeting minutes released yesterday. The next upside target level for the euro-pound pair is seen at 0.855. The pair ended Wednesday's European session at 0.8450.
However, the euro changed little against the dollar and yen. At present, the euro is trading near Wednesday's European session close of 106.37 against the yen and 1.3247 against the dollar.
Investors will now pay attention to Germany's IFO business sentiment index for February, which is due at 4 am ET. The euro may get a lift if the data turns out to be strong but the lingering uncertainty over the implementation of Greece's debt deal will halt gains.
The U.S. house price index for December and the weekly jobless claims for the week ended February 18 are expected in the New York morning session.
The material has been provided by Instaforex Company - instaforex.com
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