Forex - EUR/USD slips on Greece uncertainty, German data

Forexpros - The euro dipped against the U.S. dollar on Tuesday, amid uncertainty over whether Greece can agree on bailout terms needed to avert a default, while data showing that German industrial output posted its biggest fall in three years in December also weighed.

EUR/USD hit 1.3090 during European early afternoon trade, the session low; the pair subsequently consolidated at 1.3107, slipping 0.16%.

The pair was likely to find support at 1.3027, Monday’s low and a three-day low and resistance at 1.3202, Friday’s high.

The German finance ministry said industrial production dropped by 2.9% in December, disappointing expectations for a modest 0.1% decline.

Industrial output for November was revised up to a flat reading from a previously reported 0.6% decline.

The weak data sparked fresh concerns over the impact of the debt crisis in the euro zone on the region’s largest economy.

The euro found some support from underlying expectations that Greek political leaders will come to an agreement on bailout terms in order to avert a default when a EUR14.5 billion bond repayment comes due on March 20.

Greek Prime Minister Lucas Papademos was due to hold talks with coalition leaders later Tuesday to discuss what conditions they are prepared to accept, after postponing talks on Monday and failing to finalize an agreement over the weekend.

Earlier Tuesday, Eurogroup President Jean-Claude Juncker said he was confident Greece would remain in the single currency bloc, provided that the country fulfilled its obligations to other bloc members.

The euro also edged lower against the pound, with EUR/GBP dipping 0.05% to hit 0.8293.

Later in the day, Federal Reserve Chairman Ben Bernanke was due to testify on the economic outlook and federal budget situation before the Senate Budget Committee in Washington.