Euro jumps after PMI reports

The euro is up 0.9% after stronger-than-expected manufacturing and services reports were released.

The euro is trading at $1.3665, spurred to its largest intraday gain in three months by robust purchasing managers index (PMI) numbers. The latest figures showed that the manufacturing and services PMI came in at 53.9 and 51.9 respectively for January. Both figures exceeded estimates and are improvements on December’s numbers.

Spanish unemployment remained at 26%, in line with expectations, as the country is still suffering from the property crash a number of years ago. On a more positive note, Spain exited the bailout scheme, which tells us that investors are confident in Spanish banks.

The number of people claiming unemployment benefit in the US ticked up by 1000 this week. This is better than expected, but it highlights the fact that the US economy is not ready for additional tapering in the near future.

In reference to Brenda Kelly’s update, if EUR/USD manages to break the $1.37 level, the next target could be $1.3833.

Spot FX EUR/USD chart

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