EURUSD Movement
For the 24 hours to 23:00 GMT, EUR declined 0.32% against the USD and closed at 1.3543, as the latest batch of mixed manufacturing data from Euro-zone’s periphery nations fuelled fresh concerns on the economic recovery of the region.
The French manufacturing sector contracted for the 21st straight month in November as the nation’s manufacturing PMI declined to a reading of 48.4 in November, from previous month’s level of 49.1. Similarly, PMI for Spain’s manufacturing sector fell back into contraction territory with a reading of 48.6 in November, missing the forecast of 51.0. However, Germany’s manufacturing PMI rose above estimate to a reading of 52.7 in November, compared to a figure of 51.7 recorded in the preceding month. Italy’s Markit manufacturing PMI also rose to 51.4 in November, following a reading of 50.7 recorded in the previous month. All in all, Euro-zone’s manufacturing PMI edged up to a reading of 51.6 in November, more than analysts’ call for a rise to 51.5 and compared to previous month’s reading of 51.3.
Separately, Moody’s Investors Service, citing the government’s progress in fiscal consolidation under the Troika-supported programme, upgraded Greece’s rating from “C” to “Caa3” with a “Stable” outlook. On the other hand, Fitch Ratings affirmed Greece’s rating of “B-” and noted the economy’s ability to adjust and recover is crucial to the restoration of sovereign creditworthiness.
Meanwhile, the US Dollar gained traction after the ISM manufacturing PMI in the US advanced to a level of 57.3 in November, surpassing market expectations for the index to decline to 55.0, from a reading of 56.4 recorded in the previous month.
In the Asian session, at GMT0400, the pair is trading at 1.3537, with the EUR trading marginally lower from yesterday’s close.
The pair is expected to find support at 1.3501, and a fall through could take it to the next support level of 1.3466. The pair is expected to find its first resistance at 1.3594, and a rise through could take it to the next resistance level of 1.3652.
Later today, the Eurostat is scheduled to release a report on Euro-zone’s producer price index for October. Market participants expect the index to witness a 1.0% (YoY) fall, after recording a 0.9% decline in September.
The currency pair is trading below its 20 Hr and 50 Hr moving averages.
