Euro sinks as French data misses expectations

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Despite expectations of an improvement, French purchasing manager's index (PMI) flash estimates have worsened in July. That's set the euro down against the dollar.

The manufacturing number stays steady at 49.7, versus expectations of a rise to 50.2 (any number below 50 implies the sector is contracting).

Worse news is found in the services numbers, as PMI declines from 48.6 to 47.7. Economists had been forecasting a jump to 49.2.

Jack Kennedy, senior economist at Markit, said:

Although output fell at a sharper pace in August, the rate of decline remained much slower than seen earlier in the year. Weakness in activity and employment was broad-based across the services and manufacturing sectors, with moderate falls signalled in each case.

However, there were encouraging signs from some of the more forward-looking indicators, such as a slight rise in manufacturing new orders for the first time in over two years and service providers’ confidence holding steady on July’s 11-month high.