Following two straight decline since January 2018, Eurozone Markit purchasing managers index (PMI) data holds steady, given at 55.20 (consensus: 54.80), signaling a rise in business activities following a shaky start in 2018. Supported by a slight acceleration in Services PMI (55) and a decline in Manufacturing PMI (56), both single currency appreciation and threatening commercial instability effects played their role, curbing exports since the beginning of the year.
France and Germany PMI data published on Monday pointed toward the same direction: services remained largest contributor while manufacturing weakened, indicating that the block leaders bolster a solid start for the Eurozone in Q2.
Due on Thursday, European Central Bank Monetary Policy meeting will maintain current interest rate at -0.40% unchanged, as expected by most market participants. Current economic data point toward a recovery in economic growth, supported by cautious normalization policy implementation from European central bankers. No rate hikes are expected for 2018 from today.
Approaching hourly resistance at 1.2165 (17/01/2018 low), EUR/USD is trading at January low. The technical structure suggests short-term downward moves, heading along the 1.2180 range.
By Vincent Mivelaz