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Eurozone data has minimal effect on weak euro

By Michael Cooper August 24th, 2016

The euro weakened against both sterling and the US dollar today. The Eurozone saw a run of Flash Purchasing Managers Indices (PMIs) released today. German manufacturing and service PMIs shrank, whereas in France the increase in the services PMI countered a contracting manufacturing PMI. Despite the Eurozone in general seeing rising PMIs for both services and manufacturing, these data releases had little effect on the euro. The overwhelming themes effecting the euro still include the question of a US Federal Reserve interest rate rise before the end of the year and the positive data releases seen in the UK last week.

This morning will see the release of German final Gross Domestic Product (GDP) data – measurement of growth – which is expected to decline from last quarter’s 0.4% to 0.3% this quarter. This afternoon we will see Belgian NBB business climate data, which is forecast at 1.1. Neither of these are high tier data releases so their impact on the market it likely to be minimal.

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