Daily Afternoon Report 27.05.2015

The euro erased gains against the U.S. dollar on Wednesday, falling to one-month lows as demand for the greenback continued to be underpinned by expectations for a U.S. rate hike in the near future.
EUR/USD hit 1.0847 during European afternoon trade, the pair’s lowest since April 27; the pair subsequently consolidated at 1.0855, slipping 0.16%
The pair was likely to find support at 1.0817, the low of April 27, and resistance at 1.0983, Tuesday’s high.
Demand for the dollar continued to be underpinned after data on Tuesday showed that U.S. business investment plans increased, consumer confidence improved and house prices extended gains.
The upbeat data supported the view that the Federal Reserve could start to raise interest rates later in the year if the economy continues to improve as expected.
The single currency had strengthened earlier, after the Greek government expressed confidence to that it would make a €305 million payment to the International Monetary Fund due on June 5.
Athens had previously warned that it would be unable to make the repayment if a cash-for-reforms deal with its international lenders was not reached by then.
The euro received an additional boost after data on Wednesday showed that German consumer confidence improved this month.
The GfK consumer sentiment index ticked up to 10.2 from 10.1 a month earlier, boosted by increased domestic demand. It was the highest level since October 2001.
The euro was steady against the pound, with EUR/GBP at 0.7068.

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