The euro today failed to sustain its brief rally against the US dollar despite the release of solid Markit Services PMI data from across the Eurozone. The release of the Markit Eurozone Services PMI in the early European session was responsible for the EUR/USD’s brief rally.
The EUR/USD currency pair rallied by over 30 points from a low of 1.1840 before the PMI releases to an intra-day high of 1.1873. The pair had retraced most of its gains at the time of writing and was on a downtrend.
The release of the Markit Italy Services PMI for November was the initial catalyst for the pair’s three-hour rally, and was crucial to reversing the pair’s downtrend established during the Asian session. The Italian services PMI was recorded at 54.7 beating market expectations of 53.2. The Markit France Services PMI also beat expectations by coming in at 60.4 versus the market consensus of 60.2. The Markit Germany Services PMI disappointed by coming in at 54.3, which was lower than the expected 54.9, and might have limited the pair’s brief rally.
The euro’s brief rally was curtailed by the stronger demand for the US dollar as tracked by the US Dollar Index, which hit a high of 93.30. The slight increase in US treasury yields also contributed to the pair’s decline.
The currency pair’s short-term performance is likely to be influenced by the release of the US ISM Non-Manufacturing/Services PMI and tomorrow’s German construction and retail PMI releases.
The EUR/USD currency pair was trading at 1.1839 as at 13:50 GMT having dropped from a daily high of 1.1876 earlier today. The EUR/JPY currency pair was trading at 133.33 having declined from a daily high of 133.75.
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