Eurozone’s Services PMI Dropped Unexpectedly to the Lowest Since January
Despite that USD traders are more conservative due to physical and geopolitical risks, EUR failed to “stole” these trades to pick up. The services sector PMI in the Euro area dropped to the lower print in seven months, since January 2017, at 54.7 in August versus 54.9 the preliminary figure and 55.4 in July. The composite PMI remained stable at 55.7 in August, as in July. The 19-nation retail sales fell below forecast as well, as they contracted by 0.3% year-over-year, in July , against expectations of 0.3% decline. Moreover, the figure of the previous month revised up to an expansion of 0.6% from 0.5% before. No economic updates are expected today from the union, however, traders are looking forward to the ECB policy meeting tomorrow. The policymakers will probably consider winding back the €60 billion bond buying program or shrinking the balance sheet. There are no speculations for interest rate changes at the current record low of 0% interest and -0.4% deposit rates, thus the most significant part of the market will be the press conference from ECB President Mario Draghi.
Read the full article on JFD Research.