EUR/USD Falls to Lowest Levels Since November After Eurozone Unemployment and Inflation Data

The Euro fell to its lowest levels against the U.S. dollar since November in early trading on Friday after the release of key Eurozone economic data.

Eurostat, the European Union's statistics office, reported on Friday that the unemployment rate across the 17 countries using the euro currency remained at 12.0 percent in December, unchanged from a revised November figure. While the December figure narrowly beat analyst expectations of 12.1%, the unemployment rate remained close to the record high level of 12.2 percent in September.

The Luxembourg based statistical office of the European Union estimated that 19.010 million men and women in the Eurozone (officially called the euro area), were unemployed in December 2013.

The lowest unemployment rates were seen in Austria (4.9%), Germany (5.1%) and Luxembourg (6.2%). The highest rates were observed in Greece (27.8% in October 2013) and Spain (25.8%).

Eurostat also reported on Friday that the Eurozone inflation rate came in at 0.7 percent in January, missing analyst expectations of 0.9 percent by a wide margin. The core inflation rate, which excludes food, energy, alcohol and tobacco rose to 0.8 percent from 0.7 percent in December.

The overall weak data fueled speculation that the European Central Bank (ECB) may ramp up stimulus in order to boost the economic region.

The ECB, led by president Mario Draghi, unexpectedly announced a rate cut of 0.25 percent in November to a record low 0.25 percent, as concerns over deflation mounted. News that eurozone inflation fell to 0.7 percent in October, substantially below the ECB target of just under 2 percent, played an important part in the central bank's decision.

EUR/USD Daily Chart

Looking at the EUR/USD daily chart we can see that price fell sharply on Friday, breaking through important support and trading beneath the 1.35 level. The 200 day moving average lies below, currently at 1.33.68. The prior low of 1.3293 may also come in to play as a support level.