Euro Falls As Eurozone Inflation Slows

The euro slipped against its major opponents in European deals on Tuesday, as Eurozone inflation slowed in September from last month, a setback to the European Central Bank which has been struggling to revive growth in the bloc.

Eurozone inflation slowed marginally in September as expected, flash data from Eurostat showed.

Inflation came in at 0.3 percent, down from 0.4 percent in August. It continues to stay below the European Central Bank's target of 'below but close to 2 percent'.

Core inflation that excludes energy, food, alcohol and tobacco, eased to 0.7 percent in September, while it was forecast to remain unchanged at 0.9 percent.

The unemployment rate in the eurozone remained stable as expected in August, a separate report showed.

The jobless rate came in at 11.5 percent in August, the same rate as in July. This matched economists' expectations.

The ECB is not expected to take any fresh steps at the conclusion of its policy meeting on Thursday. The ECB President Mario is expected to reveal more details of its asset-backed securities and covered bond purchase plans when the bank's governing council meets in Naples.

The euro lost 0.7 percent to 1.2601 against the greenback, a level not seen since September 3, 2012. At yesterday's close, the pair was quoted at 1.2684. Continuation of bearish move may lead the euro to a support around the 1.25 region.

The euro fell to 0.7773 against the pound, its weakest since July 2012. This is 0.5 percent lower from Monday's close of 0.7809. The next possible support for the euro-pound pair lies around the 0.77 mark.

The U.K. economy grew more than estimated in the second quarter, data from the Office for National Statistics showed.

Gross domestic product grew 0.9 percent sequentially, up from the prior estimate of 0.8 percent. The annual growth was confirmed at 3.2 percent.

The euro that closed yesterday's deals at 138.87 against the yen declined to near a 3-week low of 138.17. If the euro extends its slide, 137.00 is seen as its next possible support level.

The unemployment rate in Japan came in at a seasonally adjusted 3.5 percent in August, data from the Ministry of Internal Affairs and Communications showed.

That was well below forecasts for 3.8 percent, which would have been unchanged from the July reading.

The euro edged down to a session's low of 1.2061 against the Swiss franc. Further downtrend may see the euro challenging support around the 1.20 level.

A leading indicator for Switzerland decreased less than expected in August, a report from economic institute KOF showed.

The KOF leading indicator slid to 99.1 on August from the revised 99.6 in July.

The euro hit a 5-day low of 1.4428 against the aussie and an 8-day low of 1.4055 against the loonie, off early highs of 1.4586 and 1.4165, respectively. Next key support level for the euro is seen around 1.435 against the aussie and 1.40 against the loonie.

The single currency reversed from an early high of 1.6375 against the kiwi with pair trading at 1.6233. The euro is poised to test support around the 1.615 region.

Looking ahead, U.S. S&P/Case - Shiller home price index for July and consumer confidence in September are due in the New York session.

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