• Business activity in the Eurozone private sector contracted in early November.
• EUR/USD trades at its weakest level in nearly two years below 1.0450.

Business activity in the Eurozone private sector contracted in early November, with the preliminary HCOB Composite Purchasing Managers Index (PMI) falling to 48.1 from 50 in October. This reading came in below the market expectation of 50.

In the same period, the HCOB Manufacturing PMI edged lower to 45.2 from 46, while the Services PMI dropped into the contraction territory at 49.2 from 51.6.

Assessing the report's findings, "the Eurozone's manufacturing sector is sinking deeper into recession, and now the services sector is starting to struggle after two months of marginal growth," noted Dr. Cyrus de la Rubia, Chief Economist at Hamburg Commercial Bank. "It is no surprise really, given the political mess in the biggest Eurozone economies lately – France's government is on shaky ground, and Germany's heading for early elections. Throw in the election of Donald Trump as US president, and it is no wonder the economy is facing challenges. Businesses are just navigating by sight."

Market reaction

The Euro came under renewed selling pressure after this report. At the time of press, EUR/USD was trading at its weakest level in nearly two years below 1.0450.