Euro softens despite encouraging economic data

Euro took a slight plunge

The positive growth in the continent was not enough to boost its currency at least for a day.

Euro took a slight plunge on Tuesday and finished lower against its major counterparts despite the resilience of economic growth in the Euro Zone at the start of 2017.

Shaky Start

The euro has kicked off the year on a shaky start, with political uncertainties in Italy and France and the recent Brexit process kept hounding the currency, which sent it to its respective highs and lows.

On Tuesday, the currency earlier recovered from its previous low of 1.07 versus the US dollar and even touched a seven-week high of 1.0774 but gave up most gains at the close to settle at 0.4% down at 1.0724.

Against the Japanese yen, the euro was little changed at 121.66 while the British pound finished 0.4% higher at 0.86.

The slump in the currency came as a surprise since the government just released upbeat figures on its manufacturing Purchasing Manager’s index showing its PMI for January jumped to 55.1 from 54.9 last December, squeaking consensus forecast of 54.8 and the strongest reading for 69 months.

The service sector PMI was little changed at 53.6 this month from 53.7 from the month prior, below analysts’ expectations of 53.9 and the weakest reading in three months while the composite output index posted its second highest reading since December 2015 at 54.3

Employment record remained to be robust as it spiked to its biggest monthly rise in eight years while exports and overall business expectations also crept up to their record highs.

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