• EUR/USD as the US Dollar extends its rally and the Eurozone Composite PMI surprisingly contracts.
• Eurozone Service PMI surprisingly decreased to 49.2, suggesting that business activity contracted in November for the first time since January.
• The US Dollar strengthens as traders doubt over Fed rate cuts in December.

EUR/USD sinks to near two-year lows below 1.0400 in European trading hours on Friday after the release of the preliminary HCOB Eurozone Purchasing Managers Index (PMI) report for November, which showed that the overall business activity surprisingly contracted. The Eurozone Composite PMI declined to 48.1 while economists expected the economic data to manage to remain near the borderline at 50.0. A figure below the 50.0 threshold is considered a contraction in economic activities

A major decline in the overall private business activity came from weakness in the Services PMI, which also contracted unexpectedly. The Services PMI, which gauges activity in the service sector, declined to 49.2 against estimates of 51.8 and the prior release of 51.6. The service sector output contracted for the first time since January.

The Manufacturing PMI continued to contract at a faster-than-expected pace. The index declined sharply to 45.2 against the estimates and the prior release of 46.0