EU focus: Euro edges up off 2-week low

The euro edged off a two-week low on Tuesday but lacked momentum after a drubbing the previous day when weak German industrial data further dampened expectations for a near-term euro zone rate hike.
Surprisingly weak German industrial orders data for December had triggered selling of the euro, although analysts said the soft figures partly reflected a strong reading in November.
But the single currency was holding above major supports, including $1.3535, which had been a key resistance level in late January and is its 100-day moving average, as well as $1.3480, a 38.2 percent retracement of its January-February rally.
"I think the euro will be supported but it will need a dose of hawkishness from the European Central Bank to rise," said Koji Fukaya, chief FX strategist at Credit Suisse.

Last week, the euro started descending from a 12-week high of $1.3862 after European Central Bank President Jean-Claude Trichet doused expectations for an imminent rate increase, saying inflation would remain contained. That was followed by an unexpected fall in the U.S. jobless rate, which sparked a rise in U.S. debt yields, further helping the dollar against the euro.
Still, traders are reluctant to buy the dollar aggressively after Federal Reserve Chairman Ben Bernanke said last week that the U.S. economy still needs the Fed's help - a stance many traders expect him to repeat when he speaks on Wednesday.
"The market seems to be in limbo. I don't think Bernanke's comments will change that," said a trader at a Japanese brokerage.
One currency that is benefiting from expectations of an early rate hike is the British pound, as chances of an early rate hike still smouldered ahead of the Bank of England's policy announcement on Thursday.
Financial markets are expecting a BoE rate hike by May, with a small chance of a hike this week priced in, but analysts' expectations are quite different with many not expecting one until the end of the year.