EUR/CAD Remains Weak After German PMI Data Release

EUR/CAD extended its decline on Friday, falling for a second consecutive trading day. The euro failed to gain support after the release of Germany's HCOB Purchasing Managers' Index, with the pair trading near 1.6100 during the European session, with the overall trend still constrained by weaker fundamental sentiment.

**German Data Fails to Reverse Euro's Downtrend**

The latest German HCOB Purchasing Managers' Index showed the eurozone composite PMI fell to 48.6 in April, below the market expectation of 50.2, slipping below the boom-bust line. This data reinforced market concerns over weakening eurozone economic momentum, with the euro maintaining its decline after the release and failing to mount an effective rebound against the Canadian dollar. Market reports indicate that EUR/CAD had previously come under pressure below the 1.6000 level, and while it has slightly recovered to near 1.6100, the overall weak pattern remains unchanged.

**Eurozone Economic Outlook Weighs on the Pair**

Beyond the PMI data, Germany's previously released producer price index also showed weakness. According to reports, Germany's monthly PPI fell 0.3%, a larger decline than market expectations, giving back the previous month's gains and recording its first drop since February. Cooling inflation signals have further dampened market expectations for eurozone monetary policy tightening, keeping the euro under sustained pressure in cross trades.

**Focus Shifts to Central Bank Stances and Risk Sentiment**

Analysts note that for EUR/CAD to stabilize and rebound, attention should be paid to shifts in policy direction from the European Central Bank and the Bank of Canada, as well as the recovery of market risk appetite. With eurozone economic data remaining weak, the pair may still face downside pressure in the near term, and the effectiveness of support near the 1.6000 level will be a key observation point for subsequent movements.