Euro falls on disappointing German Ifo data

Euro slipped on Monday as data showed German business climate improved less than expected in January while the market awaited US housing market data due later in the day.

EUR/USD traded at 1.1298 from the previous close of 1.1376, making a 0.7% slide in the single currency.

The pair has been holding a support of 1.1261 for almost a month, and a break of that will open doors to 1.1097, the multi-year low touched on 26 January.

The business expectations index for February rose to 102.5 from January's 102 but trailing market expectations of 103.0, according to the Ifo Business Climate Index, a closely followed indicator for economic activity in Germany prepared by the Ifo Institute for Economic Research in Munich.

The business climate index improved marginally to 106.8 from 106.7 compared to expectations of 107.7.

The current assessment meanwhile slipped to 113.3 from 111.7 when analysts had been expecting 112.7.

"Satisfaction with the current business situation decreased somewhat, but companies expressed greater confidence in future business developments," Ifo said Monday.

The survey showed that German manufacturers' assessments of the current business situation were slightly less favourable than last month.

After the US existing home sales data scheduled for the day, but the focus is on Fed chair Janet Yellen's Congress testimony on Wednesday as well as the two speeches by ECB President Mario Draghi, due on Tuesday and Wednesday.