For the 24 hours to 23:00 GMT, EUR rose 0.12% against the USD and closed at 1.2558, as better-than-forecasted manufacturing activity data in France and Germany eased some of the pessimism surrounding the region’s economy.
In Germany, the manufacturing purchasing managers’ index (PMI) rose to a seasonally adjusted 45.1 in August, against the expectation of 43.4. Separately, on a quarterly basis, the gross domestic product (GDP) climbed 0.3% in the Q2 FY2012, in line with previous estimate. Additionally, France’s manufacturing PMI rose to a four-month high of 46.2 in August, while the service PMI expanded to 50.2 in August. In the Euro-zone, manufacturing PMI rose to 45.3 in August, while services PMI fell slightly to a reading of 47.5 in August. The flash consumer confidence in the Euro-zone dropped sharply to -24.6 in August from -21.5 in July.
The German Chancellor, Angela Merkel and French President, Francois Hollande, made clear that it is first and foremost up to Greece to satisfy its creditors, suggesting that they are hesitant to accept the Greek Prime Minister’s demand for more time to fix his country’s weakened economy and public finances.
Moreover, German Finance Minister, Wolfgang Schaeuble, stated that giving Greece more time to implement necessary structural reforms and austerity measures would not solve its severe problems.
Meanwhile, the Greece Prime Minister, Antonis Samaras, warned that the country’s exit from the Euro would start a devastating domino effect that would hit other members of the Euro-zone.
In the Asian session, at GMT0300, the pair is trading at 1.2560, with the EUR trading marginally higher from yesterday’s close.
The pair is expected to find support at 1.2529, and a fall through could take it to the next support level of 1.2499. The pair is expected to find its first resistance at 1.2590, and a rise through could take it to the next resistance level of 1.2621.
Trading trends in the pair today are expected to be determined by the outcome of meeting between German Chancellor, Angela Merkel and Greece Prime Minister, Antonis Samaras in Berlin.
The currency pair is showing convergence with its 20 Hr moving average and trading above its 50 Hr moving average.