EUR/USD Slumps Towards Key Support Amid Strong Eurozone Data

The EUR/USD pair has been declining, reaching as low as $1.1405 on September 23, and is now approaching strong support at $1.1390.

This decline comes despite relatively strong eurozone macro data, which saw the preliminary eurozone Composite PMI rise to 53.1 in September from 52.0 in August, beating expectations of around 51.7.

The Services PMI climbed to 53.0 from 51.6, significantly beating the forecast, while the Manufacturing PMI held at 52.7 versus 52.6 expected.

However, the FX market is currently trading more heavily on the divergence in interest rate expectations, with the U.S. Dollar Index rising to around 100.8 today, its highest level in two months, due to ongoing Fed rate hike expectations and the ECB's future policy path looking less certain.