Euro Rises On Upbeat Eurozone PMI Data
Canbera-Australia (Jun 3) The euro strengthened against the other major currencies in the early European session on Friday, after data showed that the euro area private sector activity expanding more than initially estimated in May.
Data from Markit showed that the Eurozone services Purchasing Managers' Index improved to 53.3, a 3-month high, from 53.1 in April. Earlier, it was estimated to have remained unchanged at 53.1.
The final composite output index rose to 53.1 in May from 53.0 in April. According to flash estimate, the score fell to 52.9 in May.
The rates of increase accelerated in Germany and France but eased in Spain and Italy .
Germany's composite PMI came in at 54.5 in May, up from 53.6 in the prior month but below the flash reading of 54.7. The services PMI climbed to 55.2 in May, in line with flash estimate, from 54.5 in April.
In France , the composite index hit a 6-month high of 50.9 in May versus 50.2 in the previous month. But it was below the flash reading of 51.1.
Similarly, the services PMI rose to 51.6, a 7-month high, from 50.6 a month ago but below 51.8 estimated previously.
Meanwhile, the European shares rose, mirroring overnight gains on Wall Street and in Asia this morning, as investors await a key report on US employment that could give Fed policymakers ammunition for a June or July rate hike.
Economists expect the report to show an increase of about 158,000 jobs in May, while the jobless rate is expected to edge down to 4.9%.
Meanwhile, Crude oil for July delivery are currently up USD0.02 to USD49.19 a barrel. The crude oil price rose as data showed continuing declines in US crude oil inventories and production offset investor disappointment over an uneventful OPEC meeting.
In the Asian trading today, the euro held steady against its major rivals.
In the early European trading, the euro rose to 1.1159 against the US dollar, from an early 2-day low of 1.1142. If the euro extends its uptrend, it is likely to find resistance around the 1.14.
Against the yen, the pound and the Swiss franc, the euro edged up to 121.47, 0.7741 and 1.1057 from early lows of 121.07, 0.7720 and 1.1037, respectively. The euro may test resistance near 125.00 against the yen, 0.79 against the pound and 1.12 against the franc.
Meanwhile, the euro fell to 2-day lows of 1.5356 against the Australian dollar and 1.4581 against the Canadian dollar, from early highs of 1.5448 and 1.4616, respectively. Thereafter, the euro held steady against the aussie and the loonie.
Also, the euro fell to more than a 1-month low of 1.6276 against the NZ dollar, from an early high of 1.6395. The euro is likely to find support around the 1.61 area.
Looking ahead, US unemployment rate for May, non-farm payrolls for May, trade balance for April, Markit's US final services and composite PMI for May, US factory orders for April, ISM US non-manufacturing PMI for May, US durable goods orders for April and US Baker Hughes rig count data are slated for release in the New York session.
At 12:30 pm ET , Federal Reserve Board Governor Lael Brainard is expected to speak on the economic outlook and monetary policy before the Council on Foreign Relations in Washington .
Source: Alliance
