LONDON (AFX) - The euro was marginally higher in early technical trade, with many investors on the sidelines ahead of the slew of economic data due out of the US this afternoon, dealers said. "There is no fundamental reason for the move. It may be short covering ahead of the US data," Neil Parker, a currency strategist at Royal Bank of Scotland said.
"I think that it is likely that it comes under some pressure after the data and move below 0.85 usd and perhaps even down to 0.845 or 0.840," he added.
Sterling was slightly weaker on profit-taking, dealers said. "There is weakness in the manufacturing sector and an overvaluation of sterling. This is something that will play on the market for some time," Parker at RBS said.
"It doesn't look as if the euro can make any gains so the market is going through cable," he added.
Jane Fole, a currency strategist at Barclays Capital said: "Speculators are reluctant to get involved (in going long) because of the political uncertainty surrounding the EMU story."