After a tough week, EUR/USD has started the week with slight gains. Currently, the pair is trading at 1.1235, up 0.15% on the day. On the release front, it’s a busy day. German and eurozone manufacturing PMIs missed their estimates, with readings of 44.1 and 44.7, respectively. The Eurozone CPI Flash Estimate inflation in March came in at 1.5%, just shy of the estimate of 1.4%. In the U.S., retail sales are expected to tick up to 0.3%. On Tuesday, the eurozone releases PPI and the U.S. posts durable goods orders.
German and eurozone manufacturing sectors remain mired in contraction territory. This is largely due to the global trade war, which has lowered the demand for exports, such as German cars and auto parts. German manufacturing PMI dropped to 44.1, losing ground for an eighth straight month. This reading was the lowest since 2012. The all-eurozone release has also been steadily falling and is pointing to significant weakness in manufacturing.
Investors are keeping a close eye on the ebb and flow of the U.S.-China trade talks, which continues to affect the markets. The negotiations between the sides continues and there have been reports of progress. However, optimism waned on Thursday, after a senior U.S. official said that it could be months before a deal is reached. As long as uncertainty continues to swirl around the talks, traders can expect swings in the currency markets.
