CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 79% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
US English

Euro supported as eurozone services and retail sales inch higher

By Neil Dennis

11:50, 3 December 2021

Business growth
Supply managers report growing capacity constraints - Photo: Shutterstock

Business activity in the eurozone's services sectors grew in November as demand increased for a seventh-consecutive month, but capacity issues continued to constrain output.

Purchasing managers surveyed across the region by IHS Markit, showed that while the eurozone's service sector economy expanded in November, growth was disjointed by nation and sector as Germany recorded among the weakest performances, while Ireland and Spain expanded at the greatest rates.

The final purchasing managers' index (PMI) for November services read 56.9, up from 54.6 in October, but down from the preliminary November estimate of 55.9 recorded two weeks ago. A PMI reading above 50 indicated expanding business activity.

Capacity constraints

As has been the case for several months, survey respondents reported rising capacity pressures due to supply bottlenecks, while inflationary pressures continued to build as input costs rose at the fastest pace in the survey's history, while output charges also rose at record levels.

Chris Williamson, chief business economist at IHS Markit, noted however, that investors were likely looking ahead to the December surveys as new restrictions were introduced in some eurozone countries in the past couple of weeks.

What is your sentiment on EUR/GBP?

Vote to see Traders sentiment!

Covid impact due

Notably, Germany announced this week that unvaccinated citizens would be denied entry into bars, restaurants and other public indoor spaces, and that it was pushing Germans to take up their booster jabs. Austria has already introduced even stricter measures as it attempts to quell the rising fourth wave of COVID infections.


0.66 Price
-0.390% 1D Chg, %
Long position overnight fee -0.0072%
Short position overnight fee -0.0011%
Overnight fee time 22:00 (UTC)
Spread 0.00050


145.00 Price
+0.560% 1D Chg, %
Long position overnight fee 0.0113%
Short position overnight fee -0.0195%
Overnight fee time 22:00 (UTC)
Spread 0.090


1.08 Price
-0.300% 1D Chg, %
Long position overnight fee -0.0080%
Short position overnight fee -0.0003%
Overnight fee time 22:00 (UTC)
Spread 0.00050


1.26 Price
-0.380% 1D Chg, %
Long position overnight fee -0.0046%
Short position overnight fee -0.0036%
Overnight fee time 22:00 (UTC)
Spread 0.00130

Williamson said: “While growth risks have shifted to the downside, risks to the inflation outlook seem tilted to the upside if virus case numbers continue to rise and new restrictions are introduced.”

He explained further: “Supply chains will be further hit, staff availability will deteriorate and spending could shift from services to goods again, further exacerbating the imbalance of supply and demand.”

Retail sales

Eurozone retail sales increased by a tepid 0.2% in October, data from Eurostat showed on Friday, in line with forecasts, and driven by online sales, offsetting decreases in food and drink.

“This was perhaps a sign that rising COVID cases were deterring consumers from making in-person purchases,” said Michael Tran at Capital Economics, who noted that sales are likely set for further declines in the months ahead as COVID-related restrictions are introduced in some areas of the eurozone.

Nevertheless, the euro was buoyed slightly by Friday's PMI and retail sales data, with the single currency gained 0.1% against the dollar and 0.3% versus the pound.

Read more: Eurozone manufacturing growth dogged by supply-demand imbalance

Markets in this article

1.07651 USD
-0.00325 -0.300%
0.85792 USD
0.00055 +0.060%

Related topics

Rate this article

The difference between trading assets and CFDs
The main difference between CFD trading and trading assets, such as commodities and stocks, is that you don’t own the underlying asset when you trade on a CFD.
You can still benefit if the market moves in your favour, or make a loss if it moves against you. However, with traditional trading you enter a contract to exchange the legal ownership of the individual shares or the commodities for money, and you own this until you sell it again.
CFDs are leveraged products, which means that you only need to deposit a percentage of the full value of the CFD trade in order to open a position. But with traditional trading, you buy the assets for the full amount. In the UK, there is no stamp duty on CFD trading, but there is when you buy stocks, for example.
CFDs attract overnight costs to hold the trades (unless you use 1-1 leverage), which makes them more suited to short-term trading opportunities. Stocks and commodities are more normally bought and held for longer. You might also pay a broker commission or fees when buying and selling assets direct and you’d need somewhere to store them safely.
Capital Com is an execution-only service provider. The material provided on this website is for information purposes only and should not be understood as an investment advice. Any opinion that may be provided on this page does not constitute a recommendation by Capital Com or its agents. We do not make any representations or warranty on the accuracy or completeness of the information that is provided on this page. If you rely on the information on this page then you do so entirely on your own risk.

Still looking for a broker you can trust?

Join the 570.000+ traders worldwide that chose to trade with

1. Create & verify your account 2. Make your first deposit 3. You’re all set. Start trading