Euro is moving higher today, muscling through resistance even though the news out of the eurozone continues to disappoint. After bouncing off lows below 1.2900, euro touched a session high of 1.2966.
Economic confidence fell to 84.5 in October, representing a drop from the revised 85.2. However, there were estimates of 84.4, so the slight improvement is helping the situation. Composite manufacturing and services continues to contract, with advanced PMI composite falling to 45.8 in October from 46.1 in September.
Austerity measures seem to be throttling economic growth in the eurozone, and that could cause problems down the road. Today, though, focus isn’t on the economic situation — or even the worsening situation in Spain, with Prime Minister Mariano Rajoy still not asking for bailout help from the European Stability Mechanism. Instead, traders are focused on the earnings news out of the eurozone. Deutsche Bank and other companies are beating expectations, so that is providing some fuel for the euro against its major counterparts.
For now, the euro is heading higher, but things could turn around if focus once again shifts to the economic situation and to the sovereign debt crisis.
At 14:12 GMT EUR/USD is up to 1.2962 from the open at 1.2902. EUR/GBP is up to 0.8060 from the open at 0.8050. EUR/JPY is up to 103.1965 from the open at 102.9650.
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