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Purchasing managers’ indicators in both core euro-zone countries surprised to the upside, sending EUR/USD a total of around 70 pips higher.

The world’s most popular was stuck in a narrow trading range, and these positive releases enable it to fly from around 1.3545 to 1.3615.

The one hour chart shows a clear move higher after some tight range trading that characterized trading:

EURUSD higher after strong PMIs January 23 2014 foreign exchange trading

French manufacturing PMI rose from 47 to 48.8 points, better than 47.6 expected. Services PMI rose from 47.8 to 48.6, better than 48.2 expected. The scores are under 50, still reflecting contraction in Europe’s second largest economy.

The manufacturing figure for Germany jumped from 54.3 to 56.3 points, much better than 54.7 expected. This compensated for a miss in the services PMI, that rose by only 0.1% from 53.5 to 53.6, short of 54.1 predicted. Germany seems to steam on.

These are the initial, flash, figures for January. They will be followed by the all-European numbers, but they carry less weight, as the German and French figures are released earlier.

Update: Unsurprisingly, the all-European figures also came out better than expected, with flash manufacturing PMI rising to 53.9, better than 53.2 initially expected, and services scoring 51.9, more than 51.5 forecast.

The euro-zone’s current account also beat predictions by rising to 23.5 billion, more than 19.2 estimated.

In Spain, the unemployment rate for Q4 stood at 26%, as expected. The government in the euro-zone’s fourth largest economy expects the unemployment rate to fall during 2014.

It is important to note that the dollar is also weakening against the pound at the same time. So, this general dollar weakness also supports EURUSD.

For more, see the EUR/USD forecast.