Summary of Economic Indicators and EUR/USD Analysis

Date: 23 September 2026

Overview

The latest preliminary Purchasing Managers' Index (PMI) estimates for September indicate a positive surprise in the euro area, showcasing a rebound in economic activity, particularly in the services sector. Despite facing challenges such as cost pressures and previous monetary policy tightening, the European private sector is experiencing its fastest growth in months.

Key PMI Data for September

Eurozone (S&P Global)

• Services PMI (Flash): 53.0 pts (expected: 51.5 pts, previous: 51.6 pts)
• Manufacturing PMI (Flash): 52.7 pts (expected: 52.6 pts, previous: 52.7 pts)
• Composite PMI (Flash): 53.1 pts (expected: 51.7 pts, previous: 52.0 pts)

Germany (HCOB)

• Services PMI (Flash): 52.9 pts (expected: 49.9 pts, previous: 49.7 pts)
• Manufacturing PMI (Flash): 53.8 pts (expected: 54.0 pts, previous: 54.3 pts)
• Composite PMI (Flash): 53.8 pts (expected: 51.8 pts, previous: 51.8 pts)

France (S&P Global)

• Services PMI (Flash): 51.4 pts (expected: 48.3 pts, previous: 48.0 pts)
• Manufacturing PMI (Flash): 50.3 pts (expected: 51.0 pts, previous: 51.1 pts)
• Composite PMI (Flash): 51.2 pts (expected: 48.7 pts, previous: 48.5 pts)

Commentary on Data and ECB Dilemma

The data reflects resilience in the European economy, particularly with the services sector returning to expansion above the 50-point threshold in both France and Germany. The Composite index in France has reached its highest growth rate in over two years, while the euro area has seen its most dynamic rise in economic activity in nearly three and a half years.

However, the European Central Bank (ECB) faces the challenge of resurging inflationary pressures, with reports indicating a renewed acceleration in input costs and finished goods prices, partly due to rising fuel and energy prices. This situation complicates the ECB's ability to declare victory over inflation.

Despite a recent decline in global oil prices, markets are pricing in a 47% probability of another 25 basis points rate hike by the ECB in October, with expectations of a full rate increase before the end of the year.

EUR/USD Technical Analysis

Despite the positive economic indicators from Europe, the EUR/USD exchange rate has reacted contrary to expectations. The US dollar retains an advantage following the recent Federal Reserve meeting, pushing the currency pair towards a critical support zone.

Key Levels

• Support Level: 1.1400 - A sustained breakout below this level could lead to further declines towards 1.1350.
• Resistance Levels: The first significant resistance is at 1.1495, followed by a trendline resistance near 1.1560.

For buyers, a decisive breakout above the downtrend line is necessary to alleviate supply pressure and potentially move towards 1.1560. As long as the rate remains below this line, the risk of testing and breaking the 1.1400 support level remains high.