EUR/USD remained a notch weaker on Tuesday following a slew of key macro data from the Euro Area, while the greenback was firm ahead of US data set, due out later in the day, which could provide clues over future interest rates.
Preliminary figures by Markit showed earlier on Tuesday that German manufacturing sector activity had contracted for an 8th successive month in February, as stocks of purchases were reduced for the first time in almost 18 months and as supplier delivery times shortened.
The S&P Global Germany Manufacturing PMI surprisingly dropped to 46.5 in February from a level of 47.3 in January. The median analyst estimate had pointed to a reading of 48.0.
In France, manufacturing sector activity registered the sharpest contraction in 4 months in February. The S&P Global France Manufacturing PMI unexpectedly decreased to 47.9 in February from a reading of 50.5 in January, according to preliminary data. Market consensus had pointed to a slight expansion of 50.8.
Manufacturing sector activity in the Euro Area as a whole also recorded an 8th straight month of contraction in February, with chemical & plastics and basic resources being the main areas of weakness.
The S&P Global Eurozone Manufacturing PMI came in at a preliminary reading of 48.5 in February down from 48.8 in January, while falling short of market expectations of 49.3.
On the other hand, French, German and Euro Area services sector registered a larger-than-expected expansion in February, preliminary data showed.
Next, market players will be paying attention to a measure of economic sentiment and conditions in Germany for February, due out at 12:00 GMT, as well as the US preliminary Manufacturing and Services PMI figures, due out at 16:45 GMT.
Also on investors’ radar will be Friday’s report on US Core PCE prices for January.
As of 9:51 GMT on Tuesday EUR/USD was edging down 0.13% to trade at 1.0670. Last week, the major Forex pair went down as low as 1.0613, which has been its weakest level since January 6th (1.0482).
Daily Pivot Levels (traditional method of calculation)
Central Pivot – 1.0686
R1 – 1.0703
R2 – 1.0721
R3 – 1.0737
R4 – 1.0753
S1 – 1.0668
S2 – 1.0652
S3 – 1.0634
S4 – 1.0616