The “greenback” remains weak. Overview for 02.06.2021

EURUSD was falling and rising again but the “greenback” remains fundamentally weak. 

The major currency pair is consolidating on Wednesday morning after slight fluctuations last night. The current quote for the instrument is 1.2220.

The statistics from the Euro area were mostly positive. The German Final Manufacturing PMI showed 64.4 points in May after being 64.0 points before. The same indicator for the Euro Area improved up to 63.1 points against 62.8% points earlier. 

The CPI Flash Estimate in the Euro Area showed 2.0% y/y in May, the highest over the last two years, after being 1.6% y/y in the previous month and against the expected reading of 1.9% y/y. The Core CPI Flash Estimate was 0.9% y/y after being 0.7% y/y the month before.  

Inflation in the Euro Area boosted thanks to partial removal of social restrictions, which lead to a demand recovery. A decline in the number of new coronavirus cases allows countries to re-open shops, cafes, and restaurants, thus increasing consumer activismю Another thing is travelling. Of course, there are still some issues, such as delivery interruptions, which limit production and slows down the demand. 

Also, the labor market parameters in the region went up a bit – the Unemployment Rate dropped to 8.0% in April after being 8.1% in March.

As for the statistics from the USA, the Markit Manufacturing PMI showed 62.1 points in May after being 61.5 points earlier. The ISM Manufacturing PMI also improved, up to 61.2 points against 60.7 points over the same period of time. The components of the report demonstrate significant improvement of the industrial sector thanks to an increasing number of new orders.