The Euro to CAD Exchange Rate softened on Thursday as expectations that the European Central Bank will introduce new monetary easing measures at next month’s policy meeting took the shine off of today’s positive service sector data.
Earlier in the session the Euro found support from data which showed that the recovery in the Eurozone’s private sector continued in May. The regions service sector expanded at its fastest rate in three-years. The services PMI rose to a 35-month high of 53.5 up from 53.1 in April. Analysts had expected the index to tick down to 53.0.
Manufacturing output slowed to its slowest pace in six-months. According to Survey compiler Markit the Eurozone flash manufacturing purchasing managers’ index slid to 52.5 this month, from 53.4 in April, compared to expectations of 53.2.
In the afternoon the Euro eased slightly as investors continued to raise their bets that the ECB will introduce new easing measures at next month’s policy meeting and as European citizens take to the polling booths for the European elections.
The Euro is under pressure from expectations that anti-EU groups such as the UK’s UKIP party will make strong gains.
The Canadian Dollar meanwhile found support from an increased demand for riskier assets despite the release of data which showed that retail sales fell unexpectedly in May.
According to Statistics Canada, sales fell by 0.1% in March, disappointing economists who had been expecting a rise of 0.3%. The drop was the first recorded after two consecutive months of gains.
The sales report was the last major indicator released before next week’s Canadian GDP report.
With retail sales, wholesale trade and exports all showing falls in March we can expect the GDP data to come in softly.
Euro Exchange Rate News:
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