Forex - EUR/USD hits daily high after Bernanke remarks

Forex News – The euro strengthened against the U.S. dollar on Tuesday, rising to the daily high after Federal Reserve Chairman Ben Bernanke said the central bank was ready to do more to help the U.S. economic recovery.

EUR/USD hit 1.3300 during U.S. morning trade, the daily high; the pair subsequently consolidated at 1.3289, gaining 0.86%.

The pair was likely to find support at 1.3144, the days low and an eight-and-a-half month low and resistance at 1.3380, Mondays high.

In testimony to Congress’s Joint Economic Committee in Washington, Bernanke said that the U.S. economic recovery has been far less robust that the Fed had hoped and added that the labor market is likely to remain sluggish for some time to come.

Bernanke also said that the financial crisis in the euro zone was weighing on the U.S. economy and was a "significant" source of stress in markets.

Earlier in the day, concerns over a default by Greece mounted after a decision on the country’s next tranche of aid was delayed until mid-November, while euro zone finance ministers examined ways to make banks take bigger losses on their holdings of Greek debt.

Greece's Finance Minister Evangelos Venizelos dismissed speculation over an imminent default earlier, adding that the country has enough cash to continue operating until the middle of November.

The euro was also higher against the pound, with EUR/GBP jumping 1.08% to hit 0.8630.

Also Tuesday, official data showed that U.S. factory orders fell unexpectedly in August, dropping 0.2% after increasing by a downwardly revised 2.1% the previous month.

Analysts had expected factory orders to decline 0.1% in August.