EUR/USD struggles around two-week high

The Euro sheds some ground against the US dollar on the first trading day of 2023 amidst thin liquidity conditions in the financial markets.

The release of S&P Global PMIs in the Eurozone failed to bolster the shared currency on Monday. At the time of writing, the EUR/USD is trading at 1.0657 after hitting a daily high of 1.0699.

European equities are trading in the green. S&P Global revealed the Purchasing Managers Index (PMI) for factory activity in the EU, which came mixed with Spain and France’s Manufacturing PMI exceeding estimates, contrarily to Germany, which extended its downward trajectory to 47.1. Italy and the whole Euro area remained unchanged, each at 48.5 and 47.8.


European Central Bank (ECB) policymaker Joachim Nagel said he’s optimistic that Germany can avoid a serious economic slump. Nagel added that the ECB was not seeing a wage spiral and reiterated that the ECB needs to take further action to curb inflation expectations.