Euro Dips Below $1.13 Line on Weak PMIs

Forex News

The euro fell sharply against the US dollar after the release of data on business activity in the manufacturing and services sectors of the Eurozone in December, which missed the forecasts. The EUR/USD pair fell by 0.53% to 1.1298 level.

The Eurozone manufacturing PMI fell to 51.4 in December compared to expectations for 51.9 and from 51.8 a month earlier. Eurozone services PMI dropped to 51.4 in December from November's 53.4. Economists had forecast a reading of 53.5. IHS Markit's Flash Composite Purchasing Managers' Index (PMI) fell to 51.3 in December, from a final November reading of 52.7. The indicator showed its weakest since November 2014. Economists as expected a modest rise to 52.8.

Yesterday, the ECB maintained interest rates at 0.00% and reiterated that the bank’s bond-purchase scheme would terminate in December. The quantitative easing (QE) program was implemented in order to kick-start the economy and raise ultra-low inflation levels.