EUR still under external pressure – CIBC

Analysts at CIBC, point out economic activity in the Eurozone could pick up if global growth improves and should benefit the Euro. 

Key Quotes: 

“Weak survey data from the PMI’s weighed on the euro again this week, although the slowdown still appears to be driven by mainly external factors. The composite PMI fell to a new cycle low. However, compared to levels at the end of 2018 (after the prior leg down), the services component remains higher. The source of weakness is the continued decline in manufacturing, which is being impacted by sluggishness of global trade and uncertainty over tariffs.”

“If global growth starts to improve as 2020 progresses, as we anticipate given the degree of monetary and fi scal stimulus globally, the Eurozone should benefit and the euro appreciate.”