Euro Rallies Higher on Greece Bailout Deal and Upbeat Eurozone PMIs

The euro today rallied higher against the US dollar after finance ministers from across the Eurozone reached an agreement regarding Greece’s final bailout. The euro’s rally was further complemented by the release of positive PMI data from across the Eurozone by IHS Markit and in-line French GDP data.

The EUR/USD currency pair today rallied from a low of 1.1599 to a high of 1.1674 in the early European session, but was on a downtrend at the time of writing.

The currency pair’s rally was triggered by the deal reached early Friday morning between finance ministers from 19 Eurozone countries regarding Greece’s debt crisis. The ministers approved the deal between Greece and its creditors that would allow the country to emerge from its third and final bailout on 20 August. The euro’s rally was further supported by the positive Markit Flash Germany Services PMI, which came in at 53.9, versus the expected 52.2. The Markit Eurozone Services PMI also beat expectations by coming in at 55.0 as compared to the expected 53.8. The final French GDP data for the first quarter also met expectations at an annualized 2.2%.

The Markit Flash Eurozone Composite PMI also rose to a high of 54.8 as compared to the previous 54.1 and the expected decline to 53.9. The Markit Flash France Services PMI also beat expectations, while the Markit Germany Manufacturing PMI missed expectations, but had a muted impact of the pair.

The currency pair’s short-term performance is likely to be affected by the release of several Markit Flash US PMIs in the early American session.

The EUR/USD currency pair was trading at 1.1639 as at 10:37 GMT having dropped slightly from a high of 1.1674. The EUR/JPY currency pair was trading at 128.21 having risen from a low of 127.55.

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