Euro Mostly Little Changed Despite Dismal Manufacturing PMIs

The euro was little changed for the most part on Monday. While the currency fell versus some of its rivals, it managed to gain on the Great Britain pound. Overall, the euro’s performance was fairly good considering that manufacturing indices were rater bad in the most regions of the eurozone, except for France, as well as in the whole eurozone itself.
The IHS Markit Spain Manufacturing PMI rose to 48.8 in August from 48.2, exceeding the average forecast of 48.6. The IHS Markit Italy Manufacturing Purchasing Managers’ Index improved to 48.7 from 48.5, whereas the consensus forecast was also pointing at 48.6 as a likely result. The seasonally adjusted IHS Markit France Manufacturing Purchasing Managers’ Index climbed to 51.1 from 49.7, in line with expectations. The IHS Markit/BME Germany Manufacturing PMI edged up to 43.5 from the seven-year low of 43.2, also matching forecasts. The IHS Markit Eurozone Manufacturing PMI went up to 47.0 from 46.5, within expectations.
It is true that the majority of the indices improved. But almost all of them, with the exception of France’s, remained below the neutral 50.0 of no change, meaning that manufacturing continued to contract. That does not paint a good picture of the European economy.
EUR/USD dropped from 1.0990 to 1.0962 as of 23:41 GMT today. EUR/GBP jumped from 0.9030 to 0.9087. EUR/JPY was little changed at 116.42.

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