Investing.com – The euro touched session lows against the dollar on Tuesday following testimony on the monetary policy outlook to Congress by Federal Reserve Chair Janet Yellen.
EUR/USD touched lows of 1.3581 and was last down 0.23% to 1.3587.
The pair was likely to find support at 1.3560 and resistance at 1.3615.
Speaking Tuesday, Ms. Yellen said the U.S. economy is continuing to improve but added that the recovery is not yet complete. She said that considerable slack still remains in the labor market and wage growth remains weak.
The remarks came during testimony to the Senate Banking Committee in Washington.
The Fed chair reiterated that rates are likely to remain on hold for a considerable period after the bank’s quantitative easing program ends.
Interest rates could rise sooner more quickly if the labor market was to improve more quickly than expected she said, but added that if the economic recovery is disappointing interest rates would remain accommodative.
U.S. data released on Tuesday painted a mixed picture of the economic recovery.
The Commerce Department reported that U.S. retail sales rose just 0.2% in June, below forecasts for a 0.6% increase. Retail sales for May were revised up to 0.5% from a previously reported 0.3%.
A separate report showed that manufacturing activity in New York state rose to a four year high this month. The Empire state manufacturing index rose to 25.6 from 19.3 in June. Analysts had expected the index to decline to 17.0.
The single currency remained under pressure after data earlier on Tuesday showing that German economic sentiment deteriorated unexpectedly in July added to concerns over the outlook for the recovery in the euro area.
The ZEW index of German economic sentiment fell to 27.1 this month, the lowest level since December 2012, from 29.8 in June. Analysts had expected the index to tick down to 28.0.
The euro slipped lower against the yen, with EUR/JPY down 0.15% to 138.09.
Elsewhere, the dollar advanced to session highs against the yen, with USD/JPY rising 0.19% to 101.72.