EURUSD Movement
For the 24 hours to 23:00 GMT, EUR rose 0.24% against the USD and closed at 1.3623, buoyed by the latest batch of upbeat economic releases in the Euro-zone.
In the Euro-zone, official data showed that retail sales in the region rose 0.7% (MoM) during August, more than analysts’ expectation for a 0.2% rise and compared to a 0.5% increase registered in the preceding month. Another data showed that Markit service PMI in the region edged up to a level of 52.2 in September, surpassing market consensus for a rise to 52.1 from previous month’s level of 50.7. Similarly, the Markit composite PMI for the Euro-zone advanced to a level of 52.1, more than analysts’ call for a rise to 52.1 and compared to a reading of 51.5 witnessed in the earlier month. Moreover, services PMI in Italy, France and Germany also rose for September, suggesting that the European nation’s are on steady course of recovery. The main disappointment came from Spain, where a rise in business activity during August, proved short-lived as firms slipped back into decline in September.
Meanwhile, in the US, the greenback declined on lingering concerns that a government shutdown would hamper growth of the economy. President, Barack Obama, in a speech in the Washington, blamed House Speaker, John Boehner for refusing to allow a vote on a funding bill that would end a three-day government shutdown.
Separately, the Fed of Dallas President, Richard Fisher, also opined that high “economic policy uncertainty” in the US have been a “significant hindrance” to economic growth of the nation. Negative sentiment was also fuelled after data showed that the nation’s ISM non-manufacturing PMI declined more than expected to a level of 54.4 in September, from a previous month’s reading of 58.6. However, the US Dollar found some support from a report that revealed that weekly initial jobless claim edged up less-than-expected during the week ended September 27.
In the Asian session, at GMT0300, the pair is trading at 1.3624, with the EUR trading tad higher from yesterday’s close.
The pair is expected to find support at 1.3591, and a fall through could take it to the next support level of 1.3558. The pair is expected to find its first resistance at 1.3652, and a rise through could take it to the next resistance level of 1.3680.
Investors await the release of Euro-zone’s producer price index data, due later today, which the market expects to register a decline in August.
The currency pair is showing convergence with its 20 Hr moving average and is trading above its 50 Hr moving average.
