EUR Under Pressure As PMI Misses Amplify Growth Fears

EUR Slides on Weak PMIsEURUSD has come under heavy selling pressure today in response to the latest wave of eurozone PMI data released this morning. Weakness across French and German readings, as well as the overall eurozone readings, has put fresh focus on fears for the health of the eurozone economy, particularly with the ECB committed to pushing ahead with further tightening.Manufacturing Hits 37-month LowsLooking at the overall eurozone readings, the manufacturing PMI for last month fell to 43.6 from the prior month’s 44.8 level, below the 44.8 the market was looking for. At this level, manufacturing in the eurozone has fallen to a 37-month low and marked the eleventh straight monthly fall in activity. Higher borrowing costs are acting as a severe headwind to producers. Notably too, outpunch fell for a third straight month while new orders hit their lowest level since October.Services PMI Falls TooThe services PMI fell too, printing 52.4 last month, down from the prior month’s 55.1 and below the 54.4 reading the market was looking for. While still in positive territory, last month’s reading marks the slowest growth in the sector in five months. Looking at the breakdown, higher wages were seen driving input prices inflation to well above the average while business sentiment hit six-month lows.In all, the data paints a bleak picture for eurozone growth and with the ECB widely expected to push ahead with further tightening, fears of a deeper slowdown look likely to keep EUR pressured near-term.Technical ViewsEURUSDThe recent rally in EURUSD has stalled into a retest of the underside of the broken bull channel. Price has since reversed sharply and is now trading back down to the 1.0785 level. This will be a key area for bulls to defend in order to keep the focus on further upside. Should we break below here, focus will turn to 1.0515 below as next support.