The euro today declined against the US dollar despite the release of mostly positive PMI data by Markit Economics from across the Eurozone. The single currency’s decline was largely fueled by the resurgent demand for the greenback as trade tensions between China and the USA calmed down.
The EUR/USD currency pair lost over 70 points to decline from a high of 1.2289 to trade at a low of 1.2213 at the time of writing.
The currency pair’s decline could have been triggered by the release of the Markit Flash Eurozone Manufacturing PMI in the early European session, which came in at 56.0 versus the expected 56.1. The Markit France Manufacturing PMI also came in below expectations at 53.4 as compared to the expected 53.5. Other upbeat Markit releases such as the Markit German Manufacturing PMI, which was recorded at 58.1 versus the consensus estimate of 57.5, could not reverse the pair’s decline. The Markit Eurozone Services PMI also beat expectations by coming in at 55.0 versus the market estimate of 54.6.
The pair’s decline was largely accelerated by the rising yields on the 10-year US Treasuries, which hit a four-year high of 2.994%, during today’s session. The US Dollar Index also hit a new high of 90.89 due to the higher demand for the greenback. The release of the positive Markit US Manufacturing PMI also contributed to the pair’s decline.
The currency pair’s future performance is likely to be affected by tomorrow’s German IFO survey data and the US house price index.
The EUR/USD currency pair was trading at 1.2219 as at 16:06 GMT having dropped from a high of 1.2289 earlier today. The EUR/JPY currency pair was trading at 132.72 having rallied from a low of 132.07.
If you have any questions, comments or opinions regarding the Euro,
feel free to post them using the commentary form below.
