21.08.202014:57 Forex Analysis & Reviews: Euro loses its benchmark: value declines

Euro moved to a negative correction on Friday against the background of a new preliminary portion of statistics on the decline in business activity in the EU. At the same time, the greenback may once again demonstrate its weekly decline in relation to the major currencies of the world.

The euro became cheaper by 0.53%, which moved it to the level of 1.1796 dollars per euro. At the same time, the USD index in relation to a basket of six major world currencies strengthened slightly and rose by 0.36%, which allowed it to take a position of 93.129 points.

According to preliminary data of analysts, the composite PMI index in the EU, reflecting changes in business activity in the region, in the last month of summer may reach 51.6 points, while in July it was 54.9 points. This is a significant decline that market participants were not prepared for.

PMI data for selected countries in the region also indicate a plateau. So, this is evidenced by statistics in France and Germany. Moreover, the increase in the number of COVID-19 cases in these countries indicates that a new factor of pressure may form in the service sector, which in turn will then be reflected in economic activity.

Meanwhile, the greenback traded in positive territory on Friday. However, the pressure on it has not ended, and in general, by the end of the week, another decline will most likely be recorded, which will become the ninth in a row. If the dollar nevertheless reflects negative weekly dynamics, this will be the longest series of falls in the last ten years.

It is especially worth paying attention to the growth in the number of new applications for unemployment benefits in the US, which neither analysts nor market participants expected. This unpleasant surprise can further spoil the mood in the markets.