Investing.com - The euro trimmed gains against the dollar on Wednesday, pulling back from a one-week high following German media reports that the European Central Bank is concerned over the effects of a stronger single currency.
EUR/USD pulled away from 1.3520, the pair’s highest since February 2, to hit 1.3462 during U.S. morning trade, up just 0.07% for the day.
The pair was likely to find support at 1.3436, the session low and resistance at 1.3576, the high of February 7.
Sentiment on the euro was hit after German daily Bild said the ECB is concerned that a further appreciation of the euro could have a negative impact on exports from southern euro zone nations and impair further easing of the region’s debt crisis.
Earlier Wednesday, official data showed that industrial production in the euro zone rose 0.7% in December, beating expectations for a 0.2% increase.
The previous months figure was revised down to a 0.7% decline from a previously reported drop of 0.3%.
Industrial production in Germany, the region’s largest economy, rose 0.8% after falling for the four previous consecutive months, adding to signs of a recovery in the bloc.
The euro zone was to release preliminary data on fourth quarter gross domestic product on Thursday and industrial production comprises approximately 20% of total economic output.
Elsewhere, a G7 official said earlier that Tuesday’s statement by the G7 on exchange rates was aimed at indicating concerns over the speed of the yen’s recent depreciation rather than the currency’s current levels.
On Tuesday the G7 reaffirmed a commitment to market-determined exchange rates and said that fiscal and monetary policy won't target exchange rates.
The comments came ahead of a meeting of finance ministers from the G20 later in the week, which was likely to feature discussions on competitive currency devaluations.
The euro was higher against the yen, with EUR/JPY rising 0.27% to 126.08 and rallied against the pound with EUR/GBP jumping 0.80% to 0.8655.
Sterling weakened against the euro and the dollar after the Bank of England’s inflation report said inflation would remain above the 2% target until early 2016 and that economic growth was likely to remain below its pre-crisis levels until 2015.
In the U.S., the Commerce Department said retail sales rose by a seasonally adjusted 0.1% in January, in line with expectations.
Core retail sales, which exclude automobile sales, increased by 0.2%, slightly higher than expectations for a 0.1% gain.
