Euro tanks after weak economic data from Europe
The euro declined sharply after weak economic data from the European Union. In Germany, the manufacturing PMI for the month of April was 44.5, which was lower than the expected 45.0. The services PMI of 55.6 topped the consensus estimate of 55.1. The PPI for the month rose by 2.4%, which was lower than the expected 2.7%. In France, the manufacturing PMI for April was at 49.6, which was below the expected 50.0. For the EU, the manufacturing PMI of 47.8 was lower than the expected 47.9. The services PMI of 52.5 was lower than the expected 53.2, while the composite PMI was at 51.3. This data is further evidence that the EU economy has continued to weaken.
The sterling dropped against the USD even after better-than-expected retail sales numbers. The data showed that the core retail sales for the month of March rose by an annual rate of 6.2%, which was higher than the expected 4.0%. The headline retail sales rose by 6.7%, which was higher than the expected 4.6%. On a MoM basis, the headline retail sales rose by 1.1% while the core retail sales rose by 1.2%. The growth in retail sales was the fastest it has been since November 2016.
In the United States, data from the Labor Department showed that the initial jobless claims in the past week increased by 192K, which was better than the expected 205K. The continuing jobless claims were at 1.653 million. The retail sales for March rose by 1.6%, which was the highest level since 2017. The core retail sales indicator rose by 1.2%, which was higher than the expected 0.7%. In Canada, the core retail sales rose by 0.6% while the headline retail sales rose by 0.8% in February.
The GBP/USD pair continued to decline, below the lower line of the symmetrical triangle that has been forming for the past few weeks. The pair reached a low of 1.3000, which is along the 38.2% Fibonacci Retracement level on the four-hour chart. This price is also slightly below the 50-day and 25-day moving averages. After breaking away from the triangle pattern, there is a likelihood that the pair will continue moving lower.
The EUR/USD pair declined sharply today after the weak economic numbers from Europe. The pair moved from a high of 1.1300 to an intraday low of 1.1242. On the hourly chart, this price was slightly below the 50% Fibonacci Retracement level. The price is also along the lower line of the Bollinger Bands. The Accumulation and Distribution indicator has also declined slightly. There is a likelihood that the pair will continue to decline. If it does, it is likely to test the important support of 1.1220, which is along the 23.6% Fibonacci Retracement level.
The NZD/USD continued to decline today, extending a downward trend that started on March 21, when it reached a high of 0.6940. On the four-hour chart, the price is along the lower line of the Bollinger Bands. It is also below the 25-day and 50-day moving averages while the RSI has dropped to almost the oversold level of 30. This price is also below the important support of 0.6723 shown below. The pair is likely to continue dropping as it attempts to test the important support level of 0.6680.