Although the Euro softened against the US Dollar overnight, as investors reacted to the Federal Open Market Committee’s minutes and the increased likelihood of the Fed tapering stimulus, the common currency was able to advance on the Pound and recoup losses against the ‘Greenback’ this morning.
The Euro to Pound Sterling Exchange Rate is currently trading in the region of 0.8557 as of 09:40 GMT
Better-than-forecast services/manufacturing PMI for Germany and the Eurozone supported the European asset during local trade.
While economists forecast that a gauge of German manufacturing would advance to 51.1 in August from July’s 50.7 it actually reached 52.0.
Similarly, the services sector of the Eurozone’s largest economy rose from 51.3 to 52.4, significantly better than the increase to 51.7 expected.
The positive result prompted this response from senior Markit economist Tim Moore; ‘Manufacturing was an especially bright spot [for Germany] in August, with the latest figures suggesting that a rebound in export orders helped output growth accelerate to its strongest for over two years. Service providers also benefited from improving business conditions at home and across the Euro area, with total activity levels rising for a third month running. Moreover, jobs growth was maintained in the service economy during August, pointing to sustained confidence in the near-term business outlook’.
The EUR/GBP Exchange Rate hit a high of 0.8572
This news was swiftly followed by reports showing that Eurozone manufacturing PMI surged from 50.3 to 51.3, while the Eurozone’s services industry returned to growth after climbing from 49.8 to 51.0 (50 marks the difference between growth and contraction).
Eurozone composite PMI came in at 51.7, better than the rise to 50.9 expected.
Chief Markit economist Chris Williamson released this statement with the figures: ‘The Euro area’s economic recovery gained momentum in August, with manufacturing and service sector companies reporting the strongest pace of expansion for just over two years. So far, the third quarter is shaping up to be the best that the Euro area has seen in terms of business growth since the spring of 2011. […] The upturn is being led by Germany, where growth accelerated again in August’.
However, it wasn’t all good news for the 17-nation currency bloc this morning. Services/manufacturing data from France (the Eurozone’s second largest economy) failed to reach estimates, coming in at 47.7 and 49.7 respectively. Both of the nation’s sectors continue to languish below the 50 mark separating growth from contraction.
After the data was published the Euro strengthened to 1.3364 against the US Dollar, although the EUR/USD pairing remains under pressure ahead of US housing and PMI reports. Positive US news will support the case for the Fed tapering stimulus in September and will allow the ‘Greenback’ to remain bullish.
Current Euro (EUR) Exchange Rates
< Lower > Higher
The Euro/US Dollar Exchange Rate is currently in the region of: 1.3360 >
The Euro/Pound Sterling Exchange Rate is currently in the region of: 0.8557 >
The Euro/Australian Dollar Exchange Rate is currently in the region of: 1.4826 <
The Euro/ New Zealand Dollar Exchange Rate is currently in the region of: 1.7019 <
The US Dollar/Euro Exchange Rate is currently in the region of: 0.7492 >
The Pound Sterling /Euro Exchange Rate is currently in the region of: 1.1678 <
The Australian Dollar/Euro Exchange Rate is currently in the region of: 0.6746 >
The New Zealand Dollar/Euro Exchange Rate is currently in the region of: 0.5878 <
(Correct as of 09:40 GMT)
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