Euro Australian Dollar (EUR/AUD) Exchange Rate Muted despite Australian Home Loans Sliding
The Euro Australian Dollar (EUR/AUD) exchange rate fluctuated over the course of the morning, with the pairing currently trading at an inter-bank rate of AU$1.5916.
The value of Australian new investor home loans slumped by close to 50% in just three years, with data released this morning showing home loans had contracted by -2.6% in January.
Despite this, the EUR/AUD exchange remained muted during the Asian session, and then fluctuated over the course of the European session.
Australian Dollar (AUD) Muted despite Worse-than-Forecast Business Confidence
The National Australia Bank’s (NAB) business survey found that both February’s business conditions and business confidence slipped below forecast.
Chief Economist at NAB, Alan Oster said:
‘The decline in conditions was relatively broad-based in the month and continues a relatively sharp decline over the previous six months.
‘The decline in confidence was more modest but the series has now been below average for some time.
‘This may have important implications for both future investment and employment decisions of business.’
Yesterday: Euro (EUR) Fluctuates on Unexpected Slide in German Industrial Production
The Euro has made attempts to claw back some of its losses from Monday when the rate slipped following yesterday’s unexpected slide in German industrial output.
The fall in January was led by a decrease in car production which caused industrial production to slide to -0.8%.
Sentiment in the single currency was dampened following this data release, and commenting on the data, Mizuho Rates Strategist, Antoine Bouvet said:
‘Industrial production is hard data and it is really cementing the impression that the European economy is slowing down.
‘It is lending credibility to the view that the slowdown is not temporary.’
Euro Australian Dollar Outlook: Will the EUR/AUD Exchange Rate Slide as Australian Consumer Confidence Rises?
Looking ahead to the start of the Asian session, the Australian Dollar (AUD) could rise against the Euro (EUR) following the release of Westpac’s latest Consumer Confidence figures.
If Australian consumer confidence is shown to have increased for the second month in a row in March, it could buoy the ‘Aussie’.
Wednesday could see the Euro slip against the Australian Dollar after a speech from the European Central Bank’s (ECB) Yves Mersch.
If Mersch is pessimistic about the Eurozone’s economy following the poor German industrial production and any challenges the bloc could face post-Brexit, the Euro Australian Dollar (EUR/AUD) exchange rate could slide.