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FOREX-Euro fragile before German data; UK court ruling in focus

Published 24/09/2019, 08:50
© Reuters.  FOREX-Euro fragile before German data; UK court ruling in focus
USD/JPY
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* Graphic: World FX rates in 2019 http://tmsnrt.rs/2egbfVh

By Saikat Chatterjee

LONDON, Sept 24 (Reuters) - The euro nursed losses below the

$1.10 line on Tuesday after weak eurozone survey data the day

before raised concerns the economy was struggling to gain

traction despite another dose of stimulus by the European

Central Bank earlier this month.

But with net positions broadly bearish on the single

currency, traders are wary of selling the euro aggressively

before German IFO data that will provide more clues on how well

Europe's economic powerhouse is coping with the economic

slowdown.

"The hope of a stabilisation has been squashed for now and

as a result fears of a recession are rising," Ulrich Leuchtmann,

head of FX and commodity research at Commerzbank AG, said.

Against the dollar EUR=EBS , the single currency drifted

lower to $1.09984 and not far away from a September low of

$1.0926 hit on Sept. 3

IHS Markit's Euro Zone Composite Flash Purchasing Managers'

Index (PMI), sank to 50.4 in September from 51.9 in August and

was below all forecasts in a Reuters poll that had predicted a

reading of 51.9. Monday's downbeat survey results come less than two weeks

after the ECB pledged indefinite stimulus to revive the

19-country currency bloc's ailing economy.

Though employment data in the U.S. services sector also

painted a slowing picture of the world's biggest economy, the

underperformance of the European economy relative to its U.S.

counterpart, according to the Citigroup' economic surprise

index, increased.

The dollar rose slightly against the yen JPY= to 107.59

and inched higher against a basket of currencies .DXY to

98.664.

Sterling was also under the gun, wallowing at $1.2429, near

a one-week low, ahead of a UK Supreme Court ruling related to

the suspension of Britain's parliament due around 0930 GMT.

The court will rule on whether Prime Minister Boris Johnson

acted unlawfully when he suspended parliament just weeks before

Brexit, with the case's outcome potentially complicating his

plans to lead his country out of the European Union next month.

Europe vs US CESI https://tmsnrt.rs/2ml3ceE

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