Euro down despite positive Manufacturing PMI figures

Monday, Jun 01 2015

Spanish Manufacturing PMI rose to 55.8 in May from 54.2 in April, well above forecasts on incline to 54.4, signalling a sharp improvement in business conditions that was the strongest since April 2007. Improving operating conditions have now been registered on a monthly basis throughout the past year-and-a-half. Manufacturing new orders rose sharply during May, with the rate of growth quickening to the fastest in more than eight

years.

Panellists reported improving market conditions and growth of new export orders. In fact, new business from abroad increased at a marked pace, extending the current sequence of expansion to 25 months. Some panellists reported that the recent weakness of the euro against the US dollar had helped them to secure new export orders.

Furthermore, Italian Manufacturing PMI rose for the fifth consecutive month in May, registering at 54.8 from 53.8 in April. Analysts were anticipating decline to 53.1. This latest reading pointed to the most marked improvement in overall operating conditions since April 2011. Continuing the trend seen throughout 2015 to date, the level of manufacturing output rose during May. Moreover, the rate of expansion was sharp, having quickened to the fastest in just over four years. Consumer goods producers led growth, ahead of investment goods firms.

Regardless of figures, euro was pushed lower at the opening of European part of the session and is currently being traded few points above 1.09 area. Pair is likely to find support around 1.0850 and resistance above 1.0970 level. Later today, in the US session, Manufacturing PMI figures are scheduled for a release.

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