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Euro's Decline Despite Positive Eurozone data
The Euro experienced a decrease against the Dollar for a fifth consecutive day today, dipping below the pivotal 1.0800 mark. This trend came into effect due to traders leaning towards more secure assets after the Moody's downgrade of China's credit rating, spurring higher risk avoidance among them.
The descent in the EUR/USD exchange rate happened despite upbeat economic indicators from the Eurozone. There was an upswing in the Composite Purchasing Managers' Index (PMI) as it climbed to 47.6 month on month, surpassing expectations to stay steady at last month's 47.1 level. Unfortunately, such enhancements in PMI did not provide enough support for the Euro amidst macroeconomic concerns.
Cautious Market Sentiment and the US Economy Strength
An apparent decrease in the US Job Openings and Labor Turnover Survey (JOLTS) boosted the conservative feeling. The job openings in the survey have dwindled to their humblest state in over two years. However, the vigor of the US economy was emphasised by the unexpected robust figure of 52.7 released by the Institute for Supply Management (ISM) Services PMI. This data confirms the continuing stamina within a key American economic sector, indicating a tight labor market.
Future Outlook for the Eurozone and US Economy
Future estimates suggest a possible boost in Eurozone Retail Sales on Wednesday, though they are predicted to remain negative year-over-year until October. Furthermore, predictions for Thursday's Eurozone Gross Domestic Product (GDP) figures indicate zero growth compared to last year. The week's close is forecasted to bring Friday's US Nonfarm payrolls, which may indicate an upturn from prior levels.
