Euro lower despite upbeat eurozone data

Euro lower despite upbeat eurozone data

23 October 2015, 12:59
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The shared currency held lower Friday despite the fresh data showing that eurozone economy picked up momentum in October.

The euro was lower against its U.K. and U.S. rivals Friday despite the release of positive data from the euro area.

EUR/USD last traded at 1.1091, down 0.13%, while EUR/GBP was lower 0.12% at 0.7207.

Activity in the eurozone's private sector picked up in October, a surprise development that suggests the currency area's modest recovery has yet to be weakened by slowdowns in China and other large developing economies.

Data firm Markit surveyed more than 5,000 businesses across the eurozone during October. Its composite purchasing managers gauge - a measure of activity in the manufacturing and services sectors - climbed to 54.0 in October. A reading below 50 indicates activity is declining, while a reading above that level signals it is increasing. Economists surveyed by The Wall Street Journal last week had predicted a decline to 53.3 from September's reading of 53.6.

However, the polls found that new orders were at a six-month high, an indication that activity is unlikely to weaken significantly in coming months. The pickup in new orders was driven by the services sector, which is more reliant on domestic demand, while the growth of new manufacturing orders eased, possible a sign of weakening overseas demand. Businesses demonstrated their confidence in a sustained recovery by hiring additional workers.

Although the PMI was higher, Markit said it continues to point to economic growth at around the 0.4% quarter-to-quarter rate recorded in the three months to June, while hiring isn't happening quickly enough to significantly reduce high levels of unemployment in the eurozone.

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