EUR/USD attempts some recovery as it fluctuates around 1.2950, following recent lows near 1.0820. The US Dollar continues to exhibit strength, causing the currency pair to struggle for traction. However, there are signs that stabilization may be underway, thanks to recent industrial production data.
In January, Eurozone industrial production increased by 0.8% month-on-month, marking the highest production level since August of the previous year. This rise offers hope that the prolonged decline in industrial activity, which started in early 2023, may be reaching a turning point. The increase was primarily fueled by stronger production in Germany, while France and Spain experienced declines.
The January data highlights a surge in capital and intermediate goods production, which contributed significantly to the overall increase. Nonetheless, energy and consumer goods sectors saw declines, indicating a mixed recovery across different segments of the industry. Despite these challenges, the February manufacturing PMI reached its highest level in two years, suggesting a potential recovery trajectory.
Despite these positive indicators, firms have reported ongoing difficulties. Many companies noted that orders were still dropping and employment levels were on a downward trend, highlighting the challenges that remain in the sector. The resilience of the US Dollar continues to exert pressure on the EUR/USD, hindering its ability to gain significant traction.