EUR/USD Jumps as Euro-Zone Economic Activity Booms
- French and German PMIs hit multi-year highs boosting Euro-Zone sentiment further.
- EUR/USD pushes higher in holiday-thinned trade with multi-week highs in sight.
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EUR/USD continues to push higher after the latest round of Markit PMIs shows economic growth in the Euro-Zone continuing to accelerate with manufacturing leading the way. The flash composite PMI hit a 79-month high of 57.5 in November, compared to 56.0 in October, while manufacturing hit a 211-month high of 60, compared to a prior month’s reading of 58.5.
Commenting on the provisional data, Chris Williamson, chief business economist at IHS Markit said: “The message from the latest Eurozone PMI is clear: business is booming. Growth kicked higher in November to put the region on course for its best quarter since the start of 2011. The PMI is so far running at a level signalling a 0.8% increase in GDP in the final quarter of 2017, which would round-off the best year for a decade.”
PMI data provide an advance indication of private sector economic activity by tracking a selection of variables across the manufacturing, construction, retail and services sectors.
The US Dollar is also under downside pressure after Wednesday’s FOMC minutes highlighted committee members concerns over the low level of inflation. While interest rates are still expected to be raised in the US - with a 0.25% hike in December fully priced in the greenback - members are worried that inflation may remain below 2% for longer than currently expected.
Chart: EURUSD Daily Timeframe (July - November 23, 2017)
You can check out the latest EUR/USD technical analysis by DailyFX’s Ilya Spivak here.
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--- Written by Nick Cawley, Analyst
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.