Euro Rallies on Upbeat PMIs, Quickly Falls on Coronavirus Headlines

The  euro today spiked higher against the  US dollar in  the  early European session following the  release of  upbeat eurozone PMIs by  Markit Economics. However, the  EUR/USD currency pair’s rally was short-lived since the  pair fell shortly afterwards after news of  rising coronavirus infections in  South Korea damped investor risk appetite.
The  EUR/USD currency pair today rallied to  a  high of  1.0820 after the  PMI releases before quickly falling to  trade near its opening low of  1.0787 and  was trading near this low at  the  time of  writing.
The  currency pair traded with a  slightly bullish bias during the  Asian session before spiking higher in  the  early European session. The  release of  the  Markit flash Germany Manufacturing PMI, which came in  at  47.8 versus consensus estimates of  44.8. However, Germany’s services PMI missed expectations by  coming in  at  53.3 versus expectations set at  53.8. The  release of  the  upbeat eurozone preliminary manufacturing PMI, which was recorded at  49.1 beating analysts’ estimates of  47.5, had a  muted impact on  the  falling pair. The  pair’s muted reaction also extended to  the  positive eurozone services PMI print.
The  currency pair extended its decline despite the  release of  upbeat eurozone consumer price index report for  January by  Eurostat. Both the  headline and  core inflation prints met analysts’ expectations by  coming in  at  -1% and  -1.7% respectively. The  US Dollar Index‘s recovery from its daily lows drove the  pair’s decline.
The  currency pair’s short-term performance is likely to  be affected by  Markit US PMI releases and  geopolitical events.
The  EUR/USD currency pair was trading at  1.0803 as  at  11:26 GMT having fallen from a  high of  1.0820. The  EUR/JPY currency pair was trading at  120.76 having risen from a  low of  120.35.

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