EUR/USD Moves Above 1.30 Before Manufacturing Data

The euro remained lower after declining last month before data forecast to show manufacturing in the currency bloc contracted for a 22nd month, adding to pressure on the European Central Bank to cut interest rates.

The Australian dollar gained, rallying from the lowest since October 2011, after an official manufacturing index in China showed a pickup in growth, boosting trade prospects. Futures traders increased their bets that the yen will weaken against the dollar to the most since July 2007. The ECB meets on policy on June 6.

“There is still a risk that the ECB will cut rates given the weakness of the data recently,” said Greg Gibbs, a Singapore-based senior currency strategist at Royal Bank of Scotland Group Plc. “There’s some potential downside, but it’s not clear the economic data will be enough to drive the euro over its recent range.”


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