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Posted November 29th, 2013 by Charles Purdy

Good German news supports the Euro

The euro gained momentum this week, strengthening consistently against the US dollar and Japanese Yen, whilst depreciating against sterling following strong mid-week GDP figures for the UK. Overall the week has been less eventful than the week previous as Eurozone data was relatively spare in the early stages of the week. Events in Germany – the Eurozone’s largest economy – lent support to the single currency towards the end of the week as German inflation data, Consumer Confidence and the formation of a coalition Government weighed in the euro’s favour. The better than expected inflation data in particular aided the performance of the single currency as it meant that the European Central Bank is less likely to either reduce interest rates further or introduce quantitative easing to the Eurozone. There is potential for further euro movements today as flash Consumer Price Index for the Eurozone are due. This data is a key measure of inflation and therefore traders will be interested to see whether the improvement in Germany is mirrored at large. Call your trader now for a complete update on euro crosses.

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Posted November 28th, 2013 by Charles Purdy

Eurozone awaits inflation and employment data

The Eurozone received a partial boost yesterday as Germany came to an agreement on the formation of a coalition Government. The news did not impact hugely on the single currency but gains were made against the US dollar. The currency weakened sharply against sterling in response to UK GDP figures. The euro did however reach new highs against the Japanese Yen. Whilst the German elections were not weighing heavily on the currency markets, instability – such as that seen when the Italy faltered in forming a Government – can cause weakness. In addition, German Consumer Climate data came through slightly higher than predicted.

Posted November 27th, 2013 by Charles Purdy

Will today’s Eurozone data undermine the euro?

The euro continued its start the week in an uneventful fashion with much less movement than in the week previous. Once again, the lack of Eurozone data and absence of influential market rumours meant that euro stimuli were weak. The movements that were experienced in euro pairings came largely as a result of events elsewhere as we saw the seventeen-nation currency trade within a narrow range against sterling but strengthen against the US dollar on the release of poor US data. The seventeen-nation currency also plateaued against the Japanese Yen after reaching a 4-year high over the weekend. Today we will see an increase in data releases as the German Consumer Climate figures and 10-year bond yields are released this morning.

Posted November 26th, 2013 by Charles Purdy

Euro benefits from news elsewhere

Yesterday was a quiet day in terms of Eurozone influences and movements in euro currency pairings came largely as a result of events elsewhere. Today is similarly bereft of any Eurozone data releases of note and whilst market rumours and speculation always have the potential to influence euro performance it is likely that the fortunes of the seventeen-nation currency will again be largely determined by events elsewhere as we expect key figures from the UK and USA. This will all change later in the week when we have a raft of economic data releases for the Eurozone covering consumer confidence, inflation and unemployment.

Posted November 25th, 2013 by Charles Purdy

Euro still under pressure against sterling

German Business Confidence data that came out on Friday spurred a slight euro recovery as the single currency made up some some of the ground lost earlier in the week. As well as making moderate gains against sterling and the US dollar, the seventeen-nation currency reached its strongest position in four years against the Japanese yen. The week ahead is set to be a quieter week for the euro in terms of data releases, but as we have seen this week, rumours and speculation can often have a much greater effect on performance. If we see any more light shed on the European Central Bank’s deliberations concerning the use of negative interest rates then further volatility is likely to ensue as such a move would have a strong negative impact on the strength of the euro.

Posted November 22nd, 2013 by Charles Purdy

Euro undermined by poor data and negative sentiment

The euro started the week in a relatively quiet fashion, strengthening slightly against the US dollar and sterling as we saw positive economic sentiment data coming from Germany and reasonable rise in confidence in the Eurozone as a whole. The largest movements were on Wednesday as the single currency depreciated sharply against the majority of its major trading partners. Euro weakness came as a result of a market rumour suggesting that the European Central Bank (ECB) is actually considering implementing a negative overnight deposit rate. Movements on Wednesday wiped out most of the gains that the seventeen-nation currency had made against sterling and the US dollar over the previous five days or so.

Posted November 21st, 2013 by Charles Purdy

Euro struggles as worries over Eurozone economy persist

The euro struggled yesterday, weakening against almost all of its major trading partners, as rumours spread through the market that the European Central Bank (ECB) may consider a negative deposit rate if further stimulus is required. However this has not been confirmed and the head of the German central bank stated that it would not be a good idea to start loosen monetary policy further so soon after the ECB cut interest rates. The ECB vice president spoke in a similar tone mentioning that whilst a further round of monetary easing has been discussed, no “technical planning work” had taken place yet.

Posted November 20th, 2013 by Charles Purdy

Business confidence in the Eurozone rises

German economic sentiment has risen for the fourth consecutive month with data released yesterday showing confidence has reached the highest level in four years. Furthermore, confidence in the Eurozone as a whole also rose; but, by less than anticipated, dampening any chance of a significant euro rally on the back of the German figures. The euro did gain some momentum, seeing strong gains against the Japanese yen following comments from one of the ECB board members who seemingly ruling  out the use of further quantitative easing or implementing negative rates to boost growth in the seventeen member state region. First thing this morning we saw inflation data from Germany; but, little else is due to be released from the Eurozone today.

Posted November 19th, 2013 by Charles Purdy

The euro has a steady start to the week

The euro started the week in a relatively quiet fashion, although slight strengthening was seen against sterling and the US dollar due to weakness in those two currencies. Eurozone trade balance data showed a slightly lower surplus than expected, which would have had a mildly negative impact on performance. However, a Bloomberg survey revealed that whilst the majority of economists surveyed do think we will see further liquidity injections to prevent the Eurozone from experiencing deflation, they did not share the view that this would occur this year. According to the survey results, the further long-term refinancing, which would weaken the single currency, is most likely to occur in the first half of 2014.

Posted November 18th, 2013 by Charles Purdy

Busy week for Eurozone data, will it help or hinder the euro?

Friday was a relatively uneventful day for the single currency as it saw little movement against sterling and made modest gains against the US dollar. The finance ministers of the European Union did engage in an important debate on Friday regarding the ‘Single Resolution Mechanism’ – the system that will oversee the Eurozone banking system – but little was achieved in the way of finding common ground. The first big data release of this week will be tomorrow morning’s Economic Sentiment figures coming from Germany. Later in the week, German and French flash manufacturing data releases are likely to affect euro performance, whilst on Friday’s German Business Climate data may spur market volatility on Friday.

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