• EUR/USD falls to near 1.0830 as weak preliminary Eurozone PMI weighs on the Euro.
• The ECB is expected to cut interest rates two times more by the year-end.
• Investors await the US core PCE inflation for fresh guidance on interest rates.

EUR/USD weakens to near 1.0830 in Wednesday’s European session as the preliminary Eurozone Hamburg Commercial Bank (HCOB) Purchasing Managers’ Index (PMI) report for July showed that Composite numbers unexpectedly eased due to a slowdown in activities in the manufacturing as well as the service sectors.

The HCOB Composite PMI decreased to 50.1, just above the 50 threshold that separates expansion from contraction. Investors expected the Composite PMI to have expanded at a faster pace to 51.1 from the former release of 50.9. The HCOB Manufacturing PMI contracted to 45.6, while the Services PMI expanded at a slower pace of 51.9.

The comments from Dr. Cyrus de la Rubia, Chief Economist at Hamburg Commercial Bank, on flash PMI indicated that weak demand in the Eurozone’s largest economy has weighed heavily on the manufacturing sector. De la Rubia said, “French service providers increased their business activity in July due to the preparation for the Olympic Games. In contrast, demand in the German manufacturing sector seems to have dragged down overall private sector output.”