EUR/JPY Finds Temporary Support Below 162.00 Amid Disappointing Eurozone PMI

EUR/JPY Finds Temporary Support Below 162.00 Amid Disappointing Eurozone PMI

The EUR/JPY currency pair faced downward pressure, falling 0.5% to 162.00 in European trading on Thursday. Despite the Eurozone’s flash Purchasing Managers' Index (PMI) data for May coming in weaker than expected, the pair found temporary support at this critical level.

The Eurozone’s Composite PMI dropped to 49.4 in May, marking a contraction, as readings below 50 indicate a decrease in business activity. This figure was lower than the anticipated 50.7 and the April reading of 50.4. A significant contributor to this drop was the decline in the Services PMI, which unexpectedly fell to 48.9, indicating contraction within the services sector. Germany, the Eurozone’s largest economy, joined France in seeing a downturn in economic activity.

This disappointing data highlights the ongoing struggles within the Eurozone economy, particularly the fragile state of its services industry. Despite this, EUR/JPY has held steady above the key support level of 162.00, with traders closely watching this level for signs of further movement.

Additionally, market participants are awaiting the upcoming US-Japan trade negotiations later this week, which could introduce further volatility into the currency pair as developments unfold.