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23 Aug 2013
Flash: Recent economic data not an panacea for European woes – Investec
FXstreet.com (New York) - Currency markets were relatively subdued yesterday following moves in USD pairs – the notable data releases yesterday were the Chinese and Eurozone PMIs which both came in better than expected, notes Jonathan Pryor, Corporate Treasurer at Investec.
Key quotes
The Eurozone composite figure, which covers manufacturing and services, rose to 51.7 points from 50.5 in July. With a reading over 50 indicating growth, the release was good news for Eurozone and lent support to the single currency, which made gains against the pound, dollar and yen.
“With more than 40% of the UK’s exports going to Europe any signs of recovery are also good news for the UK. ECB president Mario Draghi has stood behind sovereign bond markets over the past 18 months, which has lent support to the respective economies.”
“Meanwhile the political landscape has remained strained, particularly between Germany and peripheral Europe, which is one reason why here on the dealing desk, we’re not getting too carried away. The Eurozone economy is not home and dry as unemployment is expected to remain at record levels until next year and the EU economy is 3% smaller than 5 years ago.”
Key quotes
The Eurozone composite figure, which covers manufacturing and services, rose to 51.7 points from 50.5 in July. With a reading over 50 indicating growth, the release was good news for Eurozone and lent support to the single currency, which made gains against the pound, dollar and yen.
“With more than 40% of the UK’s exports going to Europe any signs of recovery are also good news for the UK. ECB president Mario Draghi has stood behind sovereign bond markets over the past 18 months, which has lent support to the respective economies.”
“Meanwhile the political landscape has remained strained, particularly between Germany and peripheral Europe, which is one reason why here on the dealing desk, we’re not getting too carried away. The Eurozone economy is not home and dry as unemployment is expected to remain at record levels until next year and the EU economy is 3% smaller than 5 years ago.”