European Fundamentals Disappoints, Weighing on the Outlook For Growth
The final manufacturing PMI reading for the Euro-Zone unexpectedly fell to 33.5 from an initial reading of 33.6, while the index for Germany slipped to 32.1 from an advanced reading of 32.2. Meanwhile, the outlook for inflation unexpectedly increased to 1.2% from 1.1% in January
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EURUSD – The final manufacturing PMI reading for the Euro-Zone unexpectedly fell to 33.5 from an initial reading of 33.6, while the index for Germany slipped to 32.1 from an advanced reading of 32.2. Meanwhile, the outlook for inflation unexpectedly increased to 1.2% from 1.1% in January, but remains near its lowest level since the euro was introduced in 1999, and as price growth remains well below the 2% target held by the European Central Bank, policy makers may continue to ease policy further in the coming months as price pressures alleviate. Discuss the topic and your trade ideas in the EUR/USD Forum.
CHFUSD – Manufacturing activity in Switzerland fell to a record low in February as the PMI reading slipped to 32.6 from 35.0 in previous month, which was much weaker than the 34.8 estimate projected by economists. The breakdown of the report showed that the output slumped to 32.9 from 35.6 in January as the orders for machineries and chemicals faltered. The data suggested that the economy will face a deepening contraction as manufacturers scaled back on production and employment, and the outlook for the export-driven economy remains bleak as trade conditions falter. For more news and resources, visit the new Swiss franc Currency Room.
GBPUSD – Mortgage approvals in the U.K. held steady at 31K in January, which failed to meet expectations for a rise to 33K as the banking sector remains under stress. In addition, net lending for home purchases fell to 0.7B from 1.8B in December, while net consumer credit ticked higher to 0.4B from 0.3B in the previous month. Meanwhile, the U.K. manufacturing PMI dropped to the 34.7 in February from 35.8 in previous month, and conditions are likely to get worse as demands from home and abroad deteriorate. The reinforces the dire state of the economy as the annual rate of growth contracted at the sharpest pace since 1980 during the fourth quarter, and the central bank is likely to adopt addition stimulus measures to steer the nation out of a deepening recession as economists expect Europe’s second largest economy to face its worst economic slump since World War II. Discuss the topic and your trade ideas in the GBP/USD Forum.