Breaking News
Ad-Free Version. Upgrade your experience. Save up to 40% More details

Forex - Early PMIs Lift Euro After Balanced Fed Minutes

ForexFeb 21, 2019 03:24AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
© Reuters. -- The euro turned higher against the dollar in early trading in Europe Thursday, as purchasing manager indices from France and Germany signalled that the euro-zone economy may be bottoming out after its slowdown at the end of 2018.

At 03:30 AM ET (0830 GMT), the euro was at $1.1354, just below a two-week high against the dollar, after PMI readings that outstripped expectations - even though Germany's manufacturing sector appeared to contract in February.

The dollar index that measures the greenback against a basket of major currencies was at 96.297, close to a two-week low. That's despite a broadly balanced set of minutes from the Federal Reserve’s last policy meeting that indicated that interest rates could still rise later in the year if the current uncertainty over the economy clears.

"The dollar drew some lift as the minutes appeared to have appeased market participants who were clinging to views that the Fed would hike rates one more time this year - but all in all, the minutes were in line with what the Fed said in January," said Daisuke Karakama, chief market economist at Mizuho Bank.

However, the greenback and the euro were down against the British pound, after an upbeat statement following a meeting between Prime Minister Theresa May and European Commission President Jean-Claude Juncker.

The statement revived hopes that a ‘no-deal Brexit’ can be avoided at the end of next month, despite increasing signs of political disarray in the U.K. Reports suggest that May is coming under increasing pressure to push back the March 29 date when the U.K. is slated to leave the EU.

Both the ruling Conservatives and the opposition Labour Party have been hit this week by defections from their more centrist lawmakers, most of whom want the U.K. to stay in the EU. Neither party has changed its stance on Brexit immediately as a result, but the splintering appears to make the arithmetic of getting a parliamentary majority for any sort of Brexit deal more complicated.

The risks of a no-deal Brexit were spelled out by Fitch Ratings Agency late Wednesday, which put the U.K.’s credit rating on “negative watch” – a preliminary step to a downgrade – saying that at a disorderly Brexit risks a severe recession.

Elsewhere overnight, the Australian dollar fell some 1% against the greenback after reports of a ban on coal imports by one of China’s biggest ports. The report illustrated the sensitivity of the Aussie to Chinese demand for its commodities. The kiwi also edged lower after the report.

And the South African South African rand hit a one-week high, recouping the losses it made Wednesday after the government announced a $4.9 bailout for stricken power company Eskom. The bailout was smaller than feared but comes at a time when the budget deficit is at its widest in 10 years.

-Reuters contributed to this report.

Forex - Early PMIs Lift Euro After Balanced Fed Minutes

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at’s discretion.

Write your thoughts here
Are you sure you want to delete this chart?
Post also to:
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Are you sure you want to delete this chart?
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
Sign up with Email