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EUR/USD hits fresh 2-1/2 year low

FXStreet (Mumbai) - The EUR/USD pair fell to 1.2035 levels, lowest since July 2012, after the French manufacturing PMI dropped to a 4-month low in December.

The pair currently trades 0.47% lower for the day at 1.2047 levels. The French manufacturing PMI in December was confirmed at a 4-month low of 47.5. However, the German manufacturing PMI was confirmed in expansion territory at 51.2, up from the 17-month low of 49.5 in November. Meanwhile, the Eurozone manufacturing PMI was confirmed at50.6, slightly lower from the November’s 50.8.

The losses in the EUR/USD pair have been capped so far around 1.2035 levels by the expansion in the German manufacturing sector. However, weakness in the French and the aggregate Eurozone reading is likely to weigh on the single currency.

EUR/USD Technical Levels

The pair has an immediate support located at 1.2035, under which the 1.2 levels shall act as a strong psychological support. Meanwhile, resistance is located at 1.2115 (5-DMA) and 1.2157 (10-DMA).

German manufacturing PMI returns to expansionary territory

Germany’s manufacturing sector showed signs of a return to growth in December with the seasonally adjusted Markit/BME Germany Manufacturing Purchasing Managers’ Index printing at 51.2, up from November’s 17-month low of 49.5. The latest index reading was indicative of a modest improvement in operating conditions. New orders returned to growth in December, thereby ending a three-month period of contraction.
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Eurozone manufacturing PMI ends the year on a subdued note

The final seasonally adjusted Eurozone Manufacturing PMI reading of the year showed the eurozone manufacturing sector ended 2014 on a subdued note, as rates of growth for output, new orders and employment all continued to track close to stagnation.
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