Forexpros – The euro was down against the pound on Monday, trading close to a two-week low after worse-than-expected euro zone PMI data tempered optimism over a deal to tackle the region’s escalating debt crisis.
EUR/GBP hit 0.8674 during European early afternoon trade, the daily low; the pair subsequently consolidated at 0.8685, shedding 0.29%.
The pair was likely to find support at 0.8651, the low of September 26 and resistance at 0.8732, Monday’s high.
Earlier in the day, data showed that the preliminary euro zone services purchasing managers’ index slumped to a 27-month low in October, while manufacturing activity in the region also declined to a 27-month low.
The preliminary composite PMI for the euro zone fell to 47.2 in October; the lowest level since July 2009, down from September’s 49.1.
The report showed that French service sector output fell to an almost two-and-a-half-year low, while Germany’s manufacturing sector contracted sharply.
But the euro remained supported after German Chancellor Angela Merkel and French President Nicolas Sarkozy said they would unveil a plan to recapitalize European banks and expand the firepower of the euro zone’s bailout fund at Wednesday’s European Union summit.
Meanwhile, the euro was down against the U.S. dollar, with EUR/USD shedding 0.46% to hit 1.3831.
Also Monday, official data showed that industrial new orders in the euro zone rose significantly more-than-expected in August, climbing 1.9%, outstripping expectations for a 0.1% gain and rising for the first time in three months.
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