Ella 
EUR/USD came under sharp selling pressure during Monday’s European session and fell below the key support level of 1.1100. The euro zone’s purchasing managers’ index (PMI) data for September was poor, the dollar exchange rate rebounded sharply, and multiple negative factors caused the currency pair to weaken.
The Eurozone Composite PMI unexpectedly narrowed to 49.0. Economists expect growth in overall economic activity to slow to 50.6 from 51.0 in August. The sharp contraction in overall economic activity was mainly due to weakness in manufacturing and a slowdown in the expansion of service sector activity.
Commenting on the preliminary PMI value, Dr. Cyrus de la Rubia, chief economist of Hamburg Commerzbank, said: “The euro zone is heading towards stagnation. After the Olympic effect temporarily boosted France, the euro zone’s heavyweight economy, the composite purchasing managers index fell at 9 The index fell the most in 15 months in May, and it doesn’t take much imagination to foresee further weakness in the economy, given the rapid decline in new orders and backlog of orders.
Signs of further weakness will increase speculation that the European Central Bank (ECB) will cut interest rates for a third time in October. Meanwhile, the latest comments from ECB policymakers suggest they are more concerned about continued price pressures. ECB policymakers stressed the need for more data to show a further slowdown in inflation. On Friday, European Central Bank Vice President Luis de Guindos said he wanted to see more good inflation data before cutting interest rates further.
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