Investing.com - Investing.com - The euro edged up from 10-week lows against the dollar on Monday, but remained under pressure after data showing that inflation in the euro zone slowed in January fuelled fears that the European Central Bank may tighten policy to stave off the risk of deflation. EUR/USD inched up 0.07% to 1.3497, after falling to lows of 1.3478 on Friday, the weakest since November 22. The pair was likely to find support at 1.3440 and resistance at 1.3570. The euro weakened broadly after data on Friday showed that the annual rate of euro zone inflation slowed to 0.7% in January, after a 0.8% gain in December. Analysts had expected the inflation rate to tick up to 0.9%. It was the fourth consecutive month the inflation rate came in at less than 1% and was well below the ECB's target of 2%. The ECB unexpectedly cut rates to a record low 0.25% when inflation fell to a four-year low of 0.7% in October. A separate report showed that the rate of unemployment in the euro zone was unchanged at 12% in December for the third successive month. The euro also edged higher against the yen, with EUR/JPY easing up 0.11% to 137.88, recovering slightly from two-month lows of 137.46. Elsewhere, the dollar edged higher against the yen, with USD/JPY up 0.12% to 102.13. The dollar's gains looked likely to remain limited as unease over emerging markets continued to underpin safe haven demand for the yen. Market sentiment was also hit after official data released over the weekend showed that China's manufacturing purchasing managers' index ticked down to 50.5 in January from 51.0 the previous month, in line with market expectations. A separate report on Monday showed that China's official services PMI slowed to 53.4 month, from 54.6 in December.

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