Forexpros –
Forexpros – The euro traded lower against the U.S. dollar after an index of euro zone manufacturing and services contracted more than forecasted in March weighing on the single currency.
EUR/USD hit 1.3134 during U.S. morning trade, the pair’s lowest since March 16; the pair subsequently consolidated at 1.3192 in afternoon trade, giving back 0.19%
The pair was likely to find support at 1.3114, the low of February 17 and resistance at 1.3264, the high of March 19.
The single currency experienced selling pressure after Markit stated that its preliminary euro zone manufacturing purchasing managers’ index fell to 47.7 in March from a final reading of 49.0 the previous month, below expectations for a rise to 49.6.
In addition, the report indicated that the services purchasing managers’ index fell to to 48.7 from 48.8 in February. Analysts had expected the services PMI to rise to 49.3 in March.
The data came after a report showed that industrial new orders in the euro zone tumbled by a seasonally adjusted 2.3% in January, compared to expectations for a 2.1% drop.
Earlier in the day, data showed that manufacturing activity in Germany slowed to the lowest level in four months in March, while the services sector also hit a four-month low.
Sentiment also weakened after a report showed that Chinese manufacturing activity contracted for a fifth consecutive month, underlining concerns over a possible slowdown in growth in the world’s second largest economy.
The reports overshadowed data showing that U.S. jobless claims fell to the lowest level since February 2008 last week.
The U.S. Department of Labor said the number of individuals filing for initial jobless benefits in the week ending March 17 fell by 5,000 to a seasonally adjusted 348,000, beating expectations for a decline of 3,000 to 350,000.
The previous week’s figure was revised up to 353,000 from 351,000.
Meanwhile, the single currency traded higher against the pound with EUR/GBP up 0.17%, to hit 0.8340.
Traders are carefully watching the results of ECB President Draghi and Fed Chairman Bernanke speeches today for clues on future monetary policy.
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Forexpros
