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EUR AUD Exchange Rate Dips as German Current Account Swells

The Euro has taken a turn for the worse against the Australian Dollar on Tuesday’s afternoon session, dropping to a rate of 0.4852. This slight reduction in the Euro’s value comes as French officials push to get top jobs in EU offices.

While new French President Emmanuel Macron has seen a sharp decline in his popularity since he was elected, it is reported that the Macron government is seeking to put French officials at the head of the Eurogroup as well as the Eurogroup Working Group.

(First published 11:38, August 8th, 2017)

The Euro has made a marginal loss against the Australian Dollar today, following further signs of German economic strength.

  • EUR AUD rate dips to 1.4900 – AUD EUR rate rises to 0.6708
  • Higher German current account worries traders – Trade surplus rises by less than forecast
  • Australian Dollar unsettled by Chinese trade stats – NAB confidence score rises
  • Euro improvement possible on German inflation – Westpac confidence stat could boost AUD

To some extent, the Euro has been a victim of its own success today, especially when it comes to German data.

Higher DE Current Account Brings Calls for German Government Spending

Germany’s current account has been partly blamed for today’s Euro decline, which has come alongside news of a higher German trade balance.

In June, Germany’s trade balance has risen from 22bn to 22.3bn. This was less than the predicted 25.1bn result, but still showed more German exports than imports.

The current account showed greater growth, from a revised-down 16bn to 23.6bn over the same month.

This measures the difference between a country’s savings and investment, so in this case a higher figure is not necessarily better.

According to Reuters’ Joseph Nasr, this news could bring calls for action;

‘The figures are likely to prompt more criticism of Germany’s export strength after the International Monetary Fund (IMF) last month repeated its call for the government to increase investment as a way to reduce its current account surplus, increase imports and support the economic recovery in other countries’.

Australian Dollar Ticks Higher despite Chinese Data Disappointment

While Australia-related news has not been 100% positive today, the Australian Dollar has still advanced against the weaker Euro.

This rise comes after AU business confidence rose, but China reported slowing levels of importing and exporting.

In the former case, the NAB business confidence score rose from 9 points to 12, almost the best result in 2017. In the latter, signs of slowing Chinese trade have raised concerns that Australia’s biggest trade partner may be taking in less Australian goods.

Additional AU Confidence Figures could Worsen Near-term EUR AUD Trading

Australian Dollar traders are primed for further confidence figures, which will come early on Wednesday. Westpac’s measure of consumer confidence is also predicted to show a rising score, which could extend recent AUD EUR gains.

Further ahead, the main event on Friday will be German inflation rate figures. Estimates are for rising monthly and annual inflation in July, which may inspire a sharp EUR AUD turnaround.

Current Interbank EUR AUD Exchange Rates

At the time of writing, the Euro to Australian Dollar (EUR AUD) exchange rate was trading at 1.4900 and the Australian Dollar to Euro (AUD EUR) exchange rate was trading at 0.6708.