The EUR/USD pair is surging higher in anticipation of forthcoming PMI data, prompting analysts at Commerzbank to offer insights into the pair’s potential outlook.
Commerzbank’s economists predict a slightly optimistic scenario for the Eurozone as they anticipate the services PMI to surpass the Bloomberg consensus. Moreover, they expect the manufacturing sector index to exhibit strength beyond the consensus estimates. This forecast suggests a potential strengthening of the Euro against the USD compared to recent trends.
On the other side of the equation, the U.S. is expected to report slightly weaker figures. Although the PMIs in the U.S. would still indicate expansionary territory, the anticipated minor upward trend is likely to stall. Additionally, a modest increase in initial jobless claims is anticipated. While this might not signify the end of the impressive U.S. growth narrative, it could signal a temporary pause after a series of positive surprises.
The analysts acknowledge the inherent uncertainty associated with PMI data, often leading to substantial market movements due to unexpected surprises. However, if the reported figures align closely with expectations and Commerzbank’s economists’ projections hold true, the Euro’s performance today should be relatively favorable.
Conversely, any indication from the U.S. data challenging the prevailing narrative of robust economic growth could fuel further gains for the EUR/USD pair. As market participants await the PMI revelations, the potential for Euro strength appears promising, contingent on the economic data aligning with current expectations.
