Euro Rises As Eurozone PMI Falls Less Than Expected
July 22 2016 - 1:42AM
RTTF2
The euro strengthened against most major rivals in the early
European session on Friday, after data showed that the flash
eurozone composite purchasing managers' index fell less than
expected in July.
Data from the Markit showed Eurozone private sector expanded at
the weakest pace in one-and-a-half-years in July. The flash
composite output index fell to 52.9 in July, an 18-month low, from
53.1 in June. Nonetheless, the score was above the expected level
of 52.5.
The services Purchasing Managers' Index dropped marginally to
52.7 from 52.8 in June. The score was expected to drop to 52.3.
Also, Germany's private sector expanded at the fastest pace in
seven months in July. The flash composite output index rose to 55.3
from 54.4 in June. The index reached its highest level in 2016 so
far with both manufacturers and service providers reporting
stronger expansions.
The services Purchasing Managers' Index climbed unexpectedly to
54.6 from 53.7 a month ago. It was forecast to drop to 53.2.
The manufacturing PMI dropped less-than-expected to 53.7 from
54.5 in the previous month. The score was expected to fall to
53.4.
Meanwhile, European shares rose amid gradual improvements in the
corporate earning results.
In the Asian trading today, the euro held steady against its
major rivals.
In the early European trading, the euro rose to 9-day high of
1.4494 against the Canadian dollar, from an early low of 1.4419.
The euro may test resistance near the 1.46 area.
Against the U.S. dollar, the yen and the NZ dollar, the euro
advanced to 1.1041, 117.23 and 1.5791 from early lows of 1.1016,
116.39 and 1.5715, respectively. If the euro extends its uptrend,
it is likely to find resistance around 1.12 against the greenback,
123.00 against the yen and 1.61 against the kiwi.
The euro edged up to 0.8378 against the pound, from an early
1-week low of 0.8299. The euro is likely to find resistance around
the 0.86 area.
Data from Markit showed that the flash U.K. composite output
index fell to an 87-month low of 47.7 in July from 52.4 in June.
The services Purchasing Managers' Index dropped more-than-expected
to 47.4, an 88-month low, from 52.3 in the previous month. The
expected level was 48.8.
The manufacturing PMI came in at 49.1, down from 52.1 in June,
but slightly above the expected score of 48.7. This was the lowest
score in 41 months.
Meanwhile, the euro rose to 1.0876 against the Swiss franc, from
an early 2-day low of 1.0858 and held steady thereafter.
Against the Australian dollar, the euro edged up to 1.4777 from
an early low of 1.4691 and held steady thereafter.
Looking ahead, Canada consumer prices and producer price indexes
for June, Canadian retail sales data for May, flash U.S.
manufacturing PMI for July and U.S. Baker Hughes rig count data are
due for release in the New York session.
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