Forex - EUR/USD rangebound ahead of U.S. data

The euro was trading in a tight range against the dollar on Thursday as investors awaited U.S. economic data and a second day of testimony by Federal Reserve Chairman Ben Bernanke later in the day.

EUR/USD hit 1.3091 during European afternoon trade, the session low; the pair subsequently consolidated at 1.3105, shedding 0.14%.

The pair was likely to find support at 1.3049, Tuesday’s low and resistance at 1.3173, Tuesday’s high.

Demand for the dollar continued to be underpinned after Bernanke indicated Wednesday that the bank still expects to start tapering its asset purchase program by the end of the year.

In the first day of his semi-annual testimony to Congress Bernanke said the central bank could scale back its asset purchases by the end of the year if the economy continues to improve, but added that there was no “preset course.”

Bernanke said the economic recovery was continuing at a moderate pace but reiterated that monetary policy will remain accommodative for the foreseeable future.

Elsewhere, the euro was lower against the pound, with EUR/GBP down 0.19% to 0.8609 and was higher against the yen, with EUR/JPY rising 0.44% to 131.22.

Sterling firmed up after official data showed that U.K. retail sales rose 0.2% in June, in line with expectations and were 2.2% higher compared to the same month last year.

The U.S. was to release the weekly government report on initial jobless claims and data on the Philly Fed manufacturing index later in the trading day.