The euro slipped to session lows against the US dollar on Monday, after the release of mixed PMI data out of France, Germany and the Euro zone as a whole.
EUR/USD fell to 1.3509 at 7:45 GMT, currently the lowest point for todays trade, after which consolidation followed at 1.3516, down by 0.05% for the day. Support was likely to be found at psychological level of 1.3500, while resistance was to be met at current session high, 1.3547.
Earlier on Monday it became clear that Frances private sector expanded in the month of September, supported mostly by the recovering service sector and after the end of the 18-month long recessionary period. According to preliminary data by Markit, the services PMI in France rose to a two-year high, reaching 50.7 in September, as in August the index showed a reading of 48.9. Experts had anticipated that the index will advance to 49.6. On the other hand, the index, gauging activity in the French sector of manufacturing came in below the forecast reading of 50.1, slowing down to 49.5 in September from 49.7 in the preceding month. The sub-index of new orders remained almost unchanged in both sectors. The above data suggested that business conditions in the country have begun to stabilize in September, according to Markit.
Germanys private sector managed to expand at the fastest pace since the beginning of this year in September, which implied that Euro zones largest economy may continue developing in a positive manner during the third quarter of the year, despite expectations of a weaker economic growth. The manufacturing PMI in Germany rose for a third consecutive month in September, but at a slower rate than initially projected. The index of manufacturing activity reached 51.3 in September down from 51.8 in August, while estimates pointed an advance to a value of 52.0. Germanys sector of services demonstrated better than expected results, climbing to 54.4 in September, or the highest point since February, following a reading of 52.8 in August. Initial estimates pointed a lesser increase, to 53.0. The composite index, which includes the performance of both sectors in the country and covers almost two thirds of the German economy, advanced to a value of 53.8 in September from 53.5 in August.
Last but not least, business activity in the single currency zone increased more than expected in September, as the sub-index of new orders marked its highest level for the past two years, adding to prospects of a recovering economy. Overall results were mostly contributed to by expanding activity in the first two largest economies in the region, Germany and France. The services PMI rose to 52.1 in September, after a reading of 50.7 in the month of August, while expectations pointed a value of 51.0. At the same time, the preliminary manufacturing PMI slowed down to 51.1 in September, after it hit a 25-month high in August at 51.4. The better results, registered previously, were due to favorable weather and the increase in automobile manufacturing.
Meanwhile, the Markit flash manufacturing PMI for the United States was scheduled for release later on trading Monday.
Elsewhere, the euro was lower against the sterling, as EUR/GBP cross dropped 0.23% to trade at 0.8426 at 9:25 GMT. EUR/JPY pair was losing 0.50% on a daily basis to trade at 133.68 at 9:27 GMT.
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