Investing.com - The euro traded up to one-week highs against the dollar on Thursday as stronger-than-expected data on euro zone private sector activity indicated that the recovery in the euro area is strengthening.
EUR/USD hit 1.3646, the highest since January 16 and was last up 0.63% to 1.3631.
The pair was likely to find support at 1.3600 and resistance at 1.3680, the high of January 16.
Markit said the euro zone’s composite output index rose to a 31-month high of 53.2 in January, up from a final reading of 52.1 in December, as growth picked up in Germany and the rate of decline eased in France.
The preliminary reading of the euro zone’s manufacturing purchasing manager’s index rose to a 32-month high of 53.9 from 52.7 in December. Analysts had expected the index to rise to 53.0.
The region’s services PMI advanced to a four-month high of 51.9 from 51.0 in December, compared to forecasts for a reading of 51.4.
Manufacturing activity in Germany expanded at the fastest pace since May 2011 this month. Germany’s manufacturing PMI rose to 56.3 in January from a final reading of 54.3 in December. Analysts had expected the index to tick up to 54.6.
However, Germany’s services PMI rose to 53.6 from 53.5 in December, slightly below expectations for a reading of 54.0.
Manufacturing and services sector activity in France expanded at a faster than expected rate in December, but remained in contraction territory.
Separately, data from Spain showed that the country’s unemployment rate ticked up to 26.0% in the fourth quarter of 2013 from 25.98% in the previous three months.
Meanwhile, the Bank of Spain said the economy grew 0.3% in the fourth quarter, and contracted 1.2% in 2013 as a whole, confirming government estimates.
The common currency hit session highs against the pound, with EUR/GBP rising 0.48% to 0.8213, up from the one-year lows of 0.8167 struck on Wednesday. The euro was also higher against the yen, with EUR/JPY up 0.18% to 142.51.
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