The euro weakened against the other major currencies in the early European session on Friday, after data showed that Germany's manufacturing PMI fell to a two-month low in July.

Data from Markit Economics showed that Germany's manufacturing PMI dropped to 51.5 in July, while it was expected to remain unchanged at 51.9. The flash composite output index fell to 53.4 in July from 53.7 in June.

The services Purchasing Managers' Index came in at 53.7, down from 53.8 in June. It was forecast to rise to 54.

Separate data showed that Eurozone manufacturing PMI fell to 52.2 from 52.5 in June. Economists had forecast the indicator to remain unchanged at 52.5. The PMI for the service sector dropped more-than-expected to 53.8 in July from 54.4 in June. The expected score was 54.2.

The composite Purchasing Managers' Index fell to 53.7 in July from June's four-year high of 54.2.

Meanwhile, the European shares also traded lower, following disappointing results from industrial bellwethers and lingering U.S. rate hike worries amid signs of a strengthening labor market.

FOMC members will meet to discuss a rate decision on Wednesday after Federal Reserve Chair Janet Yellen reinforced expectations for a rate hike during her two-day testimony before Congress last week. While it looks increasingly unlikely that the Fed would hike rates next week, investors remain apprehensive about the Fed taking a more hawkish turn.

Regarding Greece, officials from the European Commission, the European Central Bank and the International Monetary Fund will meet in Athens today to start detailed discussions with the Greek government on a new bailout deal.

In the Asian session today, the euro held steady against its major rivals.

In the early European trading now, the euro fell to 0.7064 against the pound and 1.0511 against the Swiss franc, from early highs of 0.7091 and 1.0548, respectively. If the euro extends its downtrend, it is likely to find support around 0.69 against the pound and 1.04 against the franc.

Against the U.S. dollar and the yen, the euro dropped to 1.0935 and 135.52 from early highs of 1.0994 and 136.27, respectively. On the downside, 1.08 against the greenback and 134.00 against the yen are seen as next support levels for the euro.

The euro edged down to 1.4253 against the Canadian dollar, from an early high of 1.4326. The euro is likely to find support around the 1.40 area.

Against the Australian dollar, the euro slipped slightly to 1.4975 from an early high of 7-month high of 1.5087. The euro is likely to find support around the 1.46 area.

Meanwhile, the euro rose to an 8-day high of 1.6711 against the NZ dollar earlier and held steady thereafter.

Looking ahead, U.S. new home sales for June and flash Markit manufacturing PMI for July are slated for release in the New York session.

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