EUR/USD Retreats Ahead of Key PMI Data in US, Eurozone

EUR/USD has slumped to 1.07. The week’s gains were eroded by a miss in US economic figures, which bolstered the dollar. Markets prepare for Friday’s Purchasing Managers Index (PMI) figures for both the EU and the US.

Germany’s Producer Price Index (PPI) fell to 0.0% on a month-over-month basis in May, falling below expectations and falling to -2.2% for the year ending in May.

The latest US Initial Jobless Claims numbers were higher than expected, with 238,000 people filing for unemployment benefits in the week ending June 14. The Philadelphia Fed Manufacturing Survey for June dropped to 1.3 from 4.5, falling short of the expected 5.0. Additionally, US Housing Starts decreased to 1.277 million new residential construction projects in May.

Following Friday’s pan-EU HCOB Purchasing Managers Index (PMI) activity surveys for June are expected to recover slightly, with the EU’s June Manufacturing PMI expected to move to 47.9 from 47.3, while the Services PMI component is forecast to rise to 53.5 from 53.2. On the US side, Manufacturing and Services PMIs are both forecast to tick lower, with Manufacturing expected to slip to 51.0 from 51.3 and Services sliding to 53.7 from 54.8.

The EUR/USD pair continues to follow technical factors lower, driving intraday action further down the charts as the 200-hour Exponential Moving Average (EMA) presses down from 1.0750.