Euro to US Dollar (EUR/USD) Exchange Rate Jumps 1.0%
The Euro to US Dollar (EUR/USD) exchange rate jumped to a high of 1.1492 on Tuesday after gaining 1.0% following the publication of disappointing US Factory Orders data.
Factory Orders had been expected to slide in December, falling by -2.4% on the month. However, the actual drop of -3.4% was steeper than anticipated.
EUR/USD Exchange Rate Pressured
The Euro to US Dollar (EUR/USD) exchange rate edged slightly lower during the European session.
If the Eurozone’s Producer Price Index shows the marked monthly declination expected, the Euro could fall further.
As it stands, the EUR/USD pairing is trading in the region of 1.1331
Today’s US Factory Orders figures will also have an impact on the Euro to US Dollar exchange rate.
EUR/USD Exchange Rate Trends Higher after US Data
The Euro to US Dollar (EUR/USD) exchange rate climbed by 0.4% on Monday as the US published a mixed bag of reports.
The US ISM Manufacturing Index had been expected to ease to 54.5 in January, but it actually slid to 53.5 from a positively revised 55.1.
The final Markit Manufacturing PMI climbed from 53.7 to 53.9 in January, and construction spending increased by less-than-anticipated.
After all the data was published the Euro to US Dollar (EUR/USD) exchange rate consolidated its earlier gain to trade in the region of 1.1333.
The Euro to US Dollar (EUR/USD) exchange rate advanced by 0.3% on Monday and could extend gains if the US ISM Manufacturing report disappoints.
EUR/USD Exchange Rate Gains Despite German Manufacturing Dip
As a fresh week of trading got underway, the EUR/USD exchange rate climbed in spite of some disappointing manufacturing figures for the Eurozone’s largest economies.
French Manufacturing PMI for January was revised from an initial estimate of 49.5 to 49.2, taking it further below the 50 line separating growth from contraction.
Meanwhile, Germany’s final figure slipped slightly from 51 to 50.9.
The Euro to US Dollar (EUR/USD) exchange rate achieved a high of 1.1344
The German manufacturing report had high and low points. Markit economist Oliver Kolodseike stated; ‘employment growth slowed to a fractional pace and new orders rose only marginally, as a slight fall in new export business weighed on total demand.’
He added; ‘With input costs falling at the quickest pace since mid-2009 amid low oil and energy prices, manufacturers were able to further reduce their selling prices. As lower oil prices are starting to feed through from the factory gate to the consumer, we should hopefully see an uplift in economic growth in coming months.’
The Euro to US Dollar (EUR/USD) exchange rate fell to a low of 1.1290
It wasn’t all doom and gloom however, as Italy’s Manufacturing PMI was positively increased from 48.4 to 49.9.
The Eurozone’s own index held steady at 51, prompting this response from Markit’s chief economist Chris Williamson; ‘Eurozone manufacturing showed signs of pulling out of the doldrums at the start of the year, but the rate of expansion remained disappointingly meagre, vindicating the ECB’s decision to take drastic action to revive the economy.’
Euro to US Dollar (EUR/USD) Exchange Rate Forecast
The Euro to US Dollar (EUR/USD) exchange rate could experience further movement in the hours ahead following the release of the US ISM Manufacturing report.
Economists have forecast that the gauge eased from 55.1 to 55 in January.
A lower reading than this could weigh on the ‘Greenback’, particularly in light of last week’s below-estimate fourth quarter growth data, and the Euro could extend its previous gains.
Other reports with the potential to influence movement in the Euro to US Dollar exchange rate include the US Markit Manufacturing PMI and Construction Spending figures.
Construction spending is believed to have increased by 0.7% in December month-on-month following a -0.3% decline in November.
Investors with an interest in the EUR/USD pairing will also be looking ahead to tomorrow and the publication of Eurozone Producer Price data and the US Factory Orders report.
The Euro to Pound Sterling (EUR/GBP) exchange rate is currently trading in the region of 0.7526
The Pound Sterling to Euro (GBP/EUR) exchange rate is currently trading in the region of 1.3281
The Euro to US Dollar (EUR/USD) exchange rate is currently trading in the region of 1.1318
The US Dollar to Euro (USD/EUR) exchange rate is currently trading in the region of 0.8831