Euro Gains Against USD on Strengthening Eurozone Activity
The Euro has seen an uptick against the US Dollar, but still lingers below $1.1700. This movement can be attributed to the recent rise in Germany's IFO business climate survey, which reached a one-year high at 88.8 in August, exceeding expectations.
This improvement echoes the recovery signaled by the Eurozone's August PMI and ZEW surveys, indicating strengthening economic activity within the region.
According to Brown Brothers Harriman's (BBH) Elias Haddad, this data supports a September European Central Bank (ECB) rate hike. The ECB is currently 95% priced-in for a rate increase at their meeting on September 10th.
Haddad also notes that the widening EU-US rate gap contributes to the recent upswing in EUR/USD, with resistance near $1.1800 and support at the 200-day moving average of $1.1632.