The euro opened at 1.2609 (8:30 am) near the median of the 1.2585-1.2633 Tokyo/London range.
Weak EMU manufacturing PMI for September (50.3 expected 50.5, August 50.5) and contracting readings in Germany (49.9), France (48.4), and Greece (48.4), with Germany the biggest negative surprise prompted a 20 point drop on the release and kept the euro on the defensive for the rest of the European session. Some short covering starting about an hour after the statistics saw a minor rally back to 1.2616 but this had already reversed back to the low before the New York open.
U.S. ADP private employment data at 8:15 am (213,000 expected 205,000) brought a new marginal low at 1.2584 but that quickly bounded back to the post-PMI European high at 1.2619
Treasury yields were moving lower in the morning, the 10-year finished down 10 basis points at 2.39%, which supported the euro but it was the September manufacturing ISM at 10:00 am (56.6, expected 58.5, August 59.0) that drove the euro to its New York and daily high of 1.2640. Construction spending in August was also much worse than predicted (-0.8%, expected 0.5%, July revised to 1.2% from 1.8%).
The run up was followed by a collapse to 1.2591 within 60 minutes. With U.S. equities under steady and increasing pressure, the Dow finished off 238 points, and Treasury yields moving lower throughout the day the euro found support at 1.2600 and ranged between there and 1.2620 in the afternoon, closing at 1.2623.
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