The euro fell further versus the dollar and yen on Thursday, even as a mixed bag of economic data from the US signaled lingering weakness in the world’s largest economy.
While the US is hardly experiencing a robust recovery, conditions are grim in most areas of the euro zone, with Germany’s strong economy in stark contrast to the performance of its debt-ridden neighbors.
To make matters worse, rising borrowing costs and sever austerity measures make growth on the periphery of the euro zone unlikely in 2011.
Still, the euro’s recent weakness has not been particularly pronounced, considering the massive challenges faced by the euro area in the coming year.
The euro slipped to a fresh 3-week low of $1.3060 against the dollar, well off a 4-year low of $1.1875 reached back in June.
The single currency dipped to Y108.45 versus the yen, near a recent 3-month low of 108.33. With the loss, the euro edged closer to a 9-year low of 105.41 set in August.
Choppy dealing left the euro near 0.8450 against the sterling. The pair has seen little direction over the past few weeks, as the UK looks to get its fiscal house in order.
In economic news, new home sales in the U.S. showed a notable increase in the month of November, according to a report released by the Commerce Department on Thursday, although sales came in below economist estimates due in part to a downward revision to October sales.
The report showed that new home sales rose 5.5 percent to an annual rate of 290,000 in November from the revised October rate of 275,000.
The Commerce Department said U.S. personal spending increased by 0.4 percent in November after an upwardly revised 0.7 percent increase in the previous month.
Meanwhile, applications for jobless insurance payments fell by only 3,000 to 420,000 in the week ending December 18, according to data released by the Department of Labor Thursday morning.