Euro remains muted after mixed German flash PMI data
The Euro (EUR) remains almost steady against its major currency peers after the release of the German preliminary HCOB Purchasing Managers’ Index (PMI) data for September.
The Euro (EUR) remains relatively stable against major currencies following the release of German preliminary HCOB Purchasing Managers' Index (PMI) data for September. The manufacturing PMI at 53.8 was lower than the estimated 54.5 and the previous reading of 54.3. Meanwhile, the services PMI rose to 52.9 from 49.7 in August. Both figures above 50.0 indicate expansion in business activity.
The overall Composite PMI increased to 53.8 from 51.8 in August. The Euro is down 0.24% against the US Dollar (USD) at 1.1420, pressured by the US Dollar's broad strength and the Federal Reserve's anticipated interest rate hikes. The ECB has limited room for rate increases due to persistent inflation, which could hinder growth-supportive measures.
Analyst Li Xing Gan notes that the Euro lacks the same interest-rate support as the Dollar. The US Dollar Index is up 0.23% to 100.77, the highest in seven weeks, as policymakers warn of inflation risks. EUR/USD trades at 1.1422, showing a bearish near-term bias, with the pair below the 20-period EMA at 1.1532. Resistance is at the 20-period EMA, and sustained break above would be needed for a durable rebound.
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