- EUR/USD struggles to extend Thursday’s gain as the US stock futures drop.
- Eurozone PMIs may drop more than expected in the wake of coronavirus lockdown restrictions.
- Yellen’s call for bugger spending may acelerate the rise in US Treasury yields.
The bid tone around the single currency has weakened on Friday, keeping EUR/USD from rising above 1.21 amid losses in the US stock futures.
Focus on PMIs
Markit economics’ flash Manufacturing Purchasing Managers Index (PMI) for Germany is seen dropping to 56.5 in February from January’s 57.1 in a sign of a slight slowdown in the pace of expansion in the economic activity. The data is due at 08:30 GMT.
The Eurozone PMI due at 09:00 GMT is forecast to decline to 54.4 in February from January’s 54.8.
The ongoing coronavirus lockdown restrictions could have hurt the economy. As such, the German and Eurozone PMIs could miss estimates, in which case the shared currency would face selling pressure.
EUR/USD is trading largely unchanged on the day near 1.2085 at press time, having faced rejection at 1.2098 in Asia.
The currency pair is likely to remain under pressure in the run-up to key data releases, as the futures tied to the S&P 500 are trading 0.3% lower. The US 10-year yield looks set to extend recent gains in a USD-positive manner, with the US Treasury Secretary calling for a sizeable stimulus package to get the economy back to full employment.
EUR/USD jumped 0.46% on Thursday but stayed well within Wednesday’s high and low, forming a bullish inside day candle on the daily chart. Markets offered dollars, as the dismal US jobless claims data overshadowed losses in the US stock markets.
Technical levels
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