German PMI readings rise to five-month highs across the board, possibly hinting at a bottom in the recent slowdown
That has helped to push yields higher on the day with the euro gaining a little before surrendering those gains in quick fashion with EUR/USD back down to 1.1052 now after touching a session high of 1.1062 moments ago.
All three of the manufacturing, services and composite readings hit a five-month high and that provides additional hope that we will see a more significant recovery in the German economic outlook this year.
US 10-year yields are up by ~3 bps now to 1.759% with German 10-year yields also sitting higher at -0.28% currently.
Although risk is faring a little better today, I reckon the more upbeat sentiment warrants some caution ahead of the weekend.
The situation surrounding the new coronavirus outbreak may yet get worse still and that may see China and other countries take more drastic measures to try and contain the situation - which may lend to negative news for the global services sector.
As for the euro, if something can't go up on good news, well that sort of tells you where the risks lie with the currency at the moment.
