EUR/USD slips after Bernanke explains case for more easing

NEW YORK (Forex News Now) – The euro fell against the dollar on Friday, after Federal Reserve Chairman Ben Bernanke said there was a case for further action to boost the faltering U.S. economic recovery.

In early European currency market trading, EUR/USD hit 1.4028, down 0.4 percent on the day, after retreating from an 8-month high of 1.4158.

Speaking to the Federal Reserve Bank of Boston, Bernanke said the economy is growing at a pace “less vigorous than we would like.”

The Fed chief added: “The risk of deflation is higher than desirable… There would appear — all else being equal — to be a case for further action.”

According to EUR USD analysis, EUR/USD was likely to touch immediate support around Thursday’s low, 1.1.3955, and encounter short-term resistance around 1.4158.

Also Friday, a slew of mixed economic data was released in the United States. Reports on retail sales and manufacturing in New York State were better than expected; however, data on consumer price inflation and consumer morale fell short of expectations.

Elsewhere, the euro slumped versus sterling: EUR/GBP traded at 0.875, down 0.53 percent, according to intraday analysis.