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EUR/USD Moves Lower as European PMI Disappoint

January 22, 2016 by

EUR/USD extended its move down today as the vast majority of European Purchasing Managers’ Indexes came out below market expectations (though most of them remained safely above the neutral 50.0 level). Meanwhile, US economic data was positive for the most part with the exception of falling leading indicators.

Flash Markit manufacturing PMI ticked up from the 38-month low of 51.2 in December to 52.7 in January. It was a nice surprise for dollar bulls as experts were promising just a minuscule increase to 51.5. Still, the reading was the second lowest since October 2013. (Event A on the chart.)

Existing home sales increased to the seasonally adjusted annual rate of 5.46 million in December from 4.76 million in November, rising above the average forecast level of 5.21 million. (Event B on the chart.)

Leading indicators declined 0.2% in December following the 0.5% increase in November. Specialists had predicted a smaller drop by 0.1%. (Event B on the chart.)

EUR/USD as of 2016-01-22

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