Flailing German economy fails to breath confidence in the euro

<p>That translates to roughly a 30-pip drop after a slight nudge higher on the French PMI headline i.e. services sector beat. But the details continue to highlight problematic issues with the euro area economy as a whole – in particular Germany. Consumption activity is declining and alongside extremely poor manufacturing sector activity, a recession looks to be underway for the region's biggest economy.</p><p>While EUR/USD has fallen, it has only served to erase the gains for the day as the pair now trades around 1.0660-65. The dollar is also considerably weak amid falling yields, so there's that to offset the negative sentiment from the data in Europe.</p><p>And from a technical perspective, EUR/USD still has a shot of rebounding further so long as it keeps above the 1.0643 mark – a level noted earlier <a href="https://www.forexlive.com/news/dollar-pinned-after-10-year-treasury-yields-back-away-from-5-level-20231024/" target="_blank" rel="follow">here</a>. Elsewhere, the euro is finding it to be a tougher challenge with EUR/GBP threatening a test of the 200-day moving average at 0.8692 currently.</p>

This article was written by Justin Low at www.forexlive.com.