The euro is trading at $1.3542, down 0.35% as the Spanish manufacturing purchasing managers index dropped to 48.6 in November – a six-month low that come in both under expectation and the 50.0 contraction indicator. Even though numbers for the region as a whole were positive and in line with expectations, traders still sold the euro versus the US dollar as the unexpected drop in Spanish manufacturing highlights how severe the problems in Spain are.
At 3pm (London time) the US will announce the ISM manufacturing PMI report for November. The market consensus is for a reading of 55.2, a small decline from the 56.4 level in October. If the report comes in above expectations we could see dealers selling the euro against the dollar.
Investors are already looking ahead to Friday’s release of non-farm payrolls and unemployment numbers. The US Federal Reserve has pegged its stimulus package to the unemployment rate, so if the figure is strong it could trigger taper fears.