Euro Advances On Solid Data
June 21 2019 - 1:41AM
RTTF2
The euro strengthened against its major opponents in early
European deals on Friday, as French and German private sectors
expanded more than expected in June, suggesting a stabilization in
economic activity.
Flash survey data from IHS Markit showed that France's private
sector grew at the fastest pace in seven months in June
The composite output index rose more-than-expected to 52.9 in
June from 51.2 in May. A score above 50 indicates expansion. The
reading was forecast to rise slightly to 51.3.
Separate data showed that Germany's private sector growth
remained unchanged in June.
The flash composite purchasing managers' index, or PMI, showed a
reading of 52.6 in June, same as seen in May. Economists had
forecast a reading of 52.5.
Geopolitical tensions also remained in focus after the New York
Times reported that U.S. President Donald Trump had approved
targeted military strikes against Iran in retaliation for shooting
down a U.S. drone, and then backed out.
The currency was trading mixed against its key counterparts in
the Asian session. While it rose against the greenback and the
franc, it was holding steady versus the pound. Against the yen, it
dropped.
The euro climbed to 1.1315 against the greenback, from a low of
1.1283 hit at 2:30 am ET. The next possible resistance for the euro
is seen around the 1.15 area.
After falling to more than a 2-week low of 120.95 against the
yen at 1:00 am ET, the euro reversed direction with the pair
trading at 121.44. The euro is likely to challenge resistance
around the 124.00 mark.
Data from the Ministry of Communications and Internal Affairs
showed that Japan consumer prices increased 0.7 percent on year in
May.
That was in line with expectations and down from 0.9 percent in
April.
The euro appreciated to 0.8922 against the pound from
yesterday's closing value of 0.8889. If the euro rises further,
0.91 is likely seen as its next possible resistance level.
Data from the Office for National Statistics showed that UK net
borrowing decreased in May, but was more than economists' had
expected.
The public sector net borrowing, or PSNB, excluding banks fell
to GBP 5.1 billion from GBP 6.8 billion in April. Economists had
forecast GBP 4.2 billion borrowing.
The single currency that finished Thursday's trading at 1.1085
against the franc reached as high as 1.1127. The euro is seen
finding resistance around the 1.13 level.
The 19-nation currency spiked up to a 3-day high of 1.7229
against the kiwi, compared to 1.7144 hit late New York Thursday.
The currency may test resistance around the 1.74 level, if it rises
again.
The euro advanced to 1.4918 against the loonie and 1.6355
against the aussie, off an early low of 1.4880 and a 2-day low of
1.6287, respectively. On the upside, 1.51 and 1.65 are possibly
seen as the next resistance levels for the euro against the loonie
and the aussie, respectively.
Looking ahead, Canada retail sales for April, U.S. existing home
sales for May and Markit's services PMI for June will be out in the
New York session.
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