Forex News – Euro tumbles below $1.32 after weak PMI

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Euro tumbled against the dollar and pound on weak PMI data which raised concerns about risks facing the euro zone economy. First was the release of Italian PMI then euro zone PMI.

Italy’s PMI showed the country’s manufacturing sector shrank far more than expected, with new orders tumbling at their fastest rate in three years. Meanwhile separate PMI reports from Germany, Spain and France also showed manufacturing activity contracting sharply in those economies. The overall euro zone PMI numbers reported a drop to 45.9 from a previous 46.0.

EURUSD fell to a session low of 1.3164 from 1.3229.  The euro zone PMI are in contrast to US PMI which came in better than expected yesterday and helped boost the dollar.

Euro tumbled against sterling after better than expected UK Construction PMI lifted the British currency. EURGBP fell to 0.8111, its lowest level since June 2010.