The Euro recovered some lost ground against the Pound following yesterday’s sharp decline as data showed that a recovery in the Eurozone’s private sector continued in April.
Early in the session the Euro softened after data out of France showed that growth in the nation’s private sector lost momentum in April. According to Markit’s PMI reports the nation saw manufacturing fall from 52.1 to 50.9, its service sector fall from 51.5 to 50.3 and the overall flash composite PMI from 51.8 to 50.5. The data suggests that the Eurozone’s second largest economy is seeing stagnation in new business and French employers are still cutting jobs.
Later in the morning things turned more positive as data out of Germany came in positively. Markit’s flash German services activity index leapt from last month’s figure of 53 to 55. Manufacturing also improved from 53.7 to 54.2.
Thanks to the strong showing by Germany the wider Eurozone flash PMI reports came in better than forecast. Manufacturing across the region expanded to 53.3, Services expanded to 53.1 and the composite PMI increased to 54.0.
Despite the positive Eurozone data the French report shows just how fractured the region’s economic recovery is.
Further gains against the Pound were restrained after a report released by the UK’s Office for National Statistics showed that the UK government hit its target for deficit reduction for the last financial year with the deficit falling to its lowest level since the start of the financial crisis.
Sterling also received support from the latest Bank of England policy meeting minutes which showed that the Central Bank’s policy makers are upbeat over the state of the UK economy and predict it to strengthen further. There was no sign for a call to raise interest rates but that could be due to the meeting taking place before unemployment dropped below the 7% target set by the bank.
Euro (EUR) Exchange Rates
[table width=”100%” colwidth=”50|50|50|50|50″ colalign=”left|left|left|left|left”]
Currency, ,Currency,Rate ,
Euro,,US Dollar,1.3844 ,
Euro,,British Pound,0.8237 ,
Euro,,Australian Dollar,1.4918 ,
Euro,,Canadian Dollar,1.5280 ,