EUR/USD Analysis and Talking Points
- Eurozone PMIs shocked amid marked slowdown in growth
- Euro in the back
French PMI: Much weaker than expected across the board with the manufacturing sector slightly in expansionary territory at 51 (sub-50 = contraction zone), hitting a 19-month low. As a result, a slowdown marked at the end of the second quarter dragged the composite number to a 5-month low as growth fell to its weakest since the peak of the Omicron disruption.
German PMI: Another set of weak numbers, with the latest German PMI readings falling short of expectations and further complicating the view that the eurozone is rapidly losing momentum. Moreover, the manufacturing sector fell to a 23-month low, raising concerns about recession risks facing the Eurozone.
DailyFX Economic Calendar
euro drops: In reaction to the soft set of PMI numbers, the Euro is under pressure, as it tests the 1.05 handle on the downside, after retracing from the top 1.05 seconds. Meanwhile, German 10-year bonds rose with yields down 14 basis points as markets dumped the European Central Bank’s tightening bets.
the support: 1.05 (Psychological Round Number), 1.0470 (Weekly Low), 1.0350 (Year Low)
resistance: 1.0580 (prev CPI low), 1.06 (weekly high/round number), 1.0636 (2020 low)
EUR/USD chart: 1 minute time frame
Eurozone PMI slows to multi-month low