Euro Weakens After Eurozone Business Activity Contracts
The euro declined against its key counterparts in European deals
on Thursday, as the euro area private sector economy returned to
the contraction zone in November due to a sharp fall in services
activity amid the new restrictions to combat the second wave of
Final data from IHS Markit showed that the final composite
output index fell to 45.3 in November from 50.0 in October. The
flash reading was 45.1.
The services Purchasing Managers' Index decreased to 41.7 from
46.9 a month ago. According to flash survey, the score was
In contrast, manufacturing output growth was sustained for the
fifth month in a row.
Sentiment deteriorated as Brexit talks dragged on without any
sign of progress. France warned it could veto a trade deal between
the U.K. and the European Union if it doesn't like the terms.
The euro edged down to 1.0822 against the franc and 0.9023
against the pound, after rising to 1.0841 and 0.9068, respectively
in early deals. The next likely support for the euro is seen around
1.05 against the franc and 0.88 against the pound.
Pulling away from its early 2-1/2-year high of 1.2139 against
the greenback and more than a 3-month high of 126.66 against the
yen, the euro fell to 1.2101 and 126.20, respectively. The euro is
likely to find support around 1.19 against the greenback and 124.00
against the yen.
The euro slipped to a 2-day low of 1.6302 versus the aussie,
from a high of 1.6372 touched at 9:00 pm ET. Next key support for
the euro is likely seen around the 1.60 region.
The euro retreated to 1.7134 against the kiwi, following a high
of 1.7168 seen at 4:45 am ET. If the euro continues its fall, 1.65
is possibly seen as its next support level.
In contrast, the euro advanced to 1.5679 versus the loonie, a
level not seen since September 30. The euro is poised to find
resistance around the 1.60 region.
Looking ahead, the U.S. weekly jobless claims for the week ended
November 28 and ISM services PMI for November will be featured in
the New York session.