Euro stronger after services PMI

The euro is higher versus the US dollar after positive reports from the eurozone indicate that the region is turning around.

The repetitive news headlines about a crippled eurozone are slowly being replaced with more positive ones. The latest services purchasing managers index (PMI) for Spain came in at 50.4, which compares with a reading of 48.5 in July and provides evidence that the Spanish services sector expanded for the first time in over two years.

The eurozone as a whole announced a reported final services PMI of 50.7 in August, which is also the highest reading in two years. This boosted investors' confidence in the currency as the region may be turning a corner.

It wasn't all positive news from the region though, after Italian services PMI figures missed economists' expectations, to show the country is not out of the woods yet.

The US investor's business daily (IBD) consumer confidence report is announced at 3pm (London time). Analysts are expecting a reading of 46.2, which with a reading below 50 would indicate a pessimistic outlook. If the report is weaker than estimates we could see the euro trade higher versus the US dollar.

Spot FX EUR/USD chart

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