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Support Appears Exposed

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Greenback Bounces To Three-Week Highs

EURGBP TECHS

Downtrend Remains Intact

--Eurozone Flash Dec Composite PMI At 55.3 (57.1 in February) 
by Jai Lakhani
     LONDON (MNI) - Eurozone output grew at its slowest rate for over a year in
March, signalling a second successive month of slowing the expansion that only
in January was the highest level since June 2006. 
     The flash March Markit Composite Purchasing Managers' Index stood at 55.3,
down from the 57.1 reading seen in February, a 14-month low. 
     According to the survey, both Germany and France languished, with output
growth slowing to a seven-month low in France and an eight-month low for
Germany. The rest of the single currency area didn't fare much better
registering the weakest increase for five months. 
     Both manufacturing and services saw new order inflows wane with good export
orders showing the smallest rise since November 2016 and overall order inflows
showing the smallest monthly increase seen over the past 14 months. Combined
with sharply rising input costs again facilitated a historical marked rise in
average selling prices for goods and services. 
     --EURO STRENGTH WEIGHS
     "While the first quarter average PMI reading remains relatively robust,
indicative of GDP rising by 0.7-0.8% (in Q1), the loss of momentum since the
buoyant start to the year has been quite dramatic" said Chris Williamson, chief
business economist at survey compiler IHS Markit. 
     "At least some of the slowing may be ascribed to bad weather in some
northern regions and, perhaps more importantly, 'growing pains' resulting from
the strength of the recent growth spurt... Backlogs continue to rise as a result
of these growth constraints," he added.
     "However other factors are clearly at play. The fact that export order book
growth has more than halved since the end of last year suggests the stronger
euro is taking an increasing toll on export performance... The data therefore
suggest that eurozone growth peaked around the turn of the year and the region
is settling into slower, but still robust pace of expansion," Williamson added.
--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com
--MNI London Bureau; +44 203 865 3828; email: jai.lakhani@marketnews.com
[TOPICS: M$X$$$,MT$$$$,M$XDS$]