Forex: EUR/GBP: Ups and downs in euro-area PMIs

on Nov 6, 2013
Listen Wednesday, November 6th:_ The EUR/GBP yesterday logged a 0.66 percent loss with the daily candle opening at 0.8461 and closing at 0.8395. The intraday trading range was from 0.8462 to 0.8390.

Thus far today, the pair has been trading between 0.8405 and 0.8377 – the lowest point since 3 October. Since yesterday’s break through the psychological level of 0.8400, the mark has been offering resistance and currently the quote is trading at 0.8385.
Markit today reported the Spanish Services PMI, reflecting activity among managers of companies in the service sector, as a rise to 49.6 points in October from 49.0 in September. The index remains below the key level of 50 points separating contraction from expansion. “The pace of recruitment … declined significantly” in October, Markit noted. Spain’s economy emerged from a two-year recession in the third quarter, registering growth of 0.1 percent q/q.

The French Services PMI rose to 50.9 in October, slightly down on September’s 51.0 points but above expectations and preliminary data at 50.2.
The German Services PMI fell to 52.9 in October from 53.7 in September, better than expectations and the preliminary reading at 52.3 and indicating positive development in the sector for the fifth consecutive month. Tim Moore from Markit said that the index points to continued improvement in the German economy early in the fourth quarter, with the pace of expansion in line with the wider trend that began in the summer.

Also in Germany, Factory Orders m/m for September rose by 3.3 percent, significantly beating expectations for a 0.6 percent increase.
In Italy, the Services PMI fell to 50.5 points in October from the previous level of 52.7 but holding above the 50 mark.
Retail Sales in the Eurozone dropped by 0.6 percent in September, whereas analysts had been picking a fall of 0.3 percent. The prior period showed a 0.5 percent increase revised down from 0.7.

And the Eurozone Final Services PMI for October grew to 51.6 points from the prior 50.9, bettering expectations for no change.
In the UK, the BRC Shop Price Index y/y fell by a half a percent in October.
The Halifax House Price Index for October m/m grew by 0.7 percent, versus forecasts for a 0.4 percent increase.
Manufacturing Production in the UK rose by 1.2 percent in September, matching forecasts. The Industrial Production also scored a gain, increasing by 0.9 percent in September. Analysts had expected a rise by 0.7 percent.
Still to come in the UK, the NIESR GDP Estimate for October is scheduled for release at 15.00 UTC.
Today’s resistances: 0.8400, 0.8415 and 0.8440.
Supports: 0.8370, 0.8345 and 0.8300.
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