The Euro has fallen by as much as 0.4% against the British Pound after the release of a slew of economic data showed that the Eurozone remains mired in recession.
Retail sales fell, PMI for the service sector declined more than expected and GDP fell by -0.2% on a quarter by quarter by basis. On a yearly basis the Eurozone contracted more than economist expectations with the troubled region contracting by 1.1% from the previous year.
One bright spot however is that the pace of the Eurozone’s contraction slowed on a quarter by quarter basis. The Eurocrisis continues to have a significant impact on the region with even Europe’s strongest economy, Germany, suffering declines in a number of key sectors.
Adding to the GDP woes was the release of the regions PMI data. In all but one of the region’s top economies did the figures show signs of growth. The figures however did give investors some optimism that things are showing signs of improvement. Spain’s services PMI rose to a 23-month high to 47.2.
Chris Williamson, chief economist at Markit, said the data was encouraging, but hardly a reason to cheer as the Eurozone’s long recession was clearly continuing.
“The final PMI confirms the message from the earlier flash reading that the Eurozone remains gripped in the longest recession since the birth of the single currency, set to endure a seventh successive quarter of decline in the second quarter.
The survey points to GDP falling by 0.2%, similar to the decline seen in the first quarter.
Policymakers and politicians will nevertheless seek solace in the fact that the rate of decline has now eased for two consecutive months, and that Germany is stabilising. Downturns have also eased in France, Italy and especially Spain since earlier in the year.
However, the reality is that the region lacks any growth drivers, making it difficult to believe that anything better than a mere stabilisation of economic activity remains unlikely for the foreseeable future.”
Current Euro (EUR) Exchange Rates
The Euro/US Dollar Exchange Rate is currently in the region of: 1.3070
The Euro/Pound Sterling Exchange Rate is currently in the region of: 0.8508
The Euro/Australian Dollar Exchange Rate is currently in the region of: 1.3644
The Euro/ New Zealand Dollar Exchange Rate is currently in the region of: 1.6339
The US Dollar/Euro Exchange Rate is currently in the region of: 0.7649
The Pound Sterling /Euro Exchange Rate is currently in the region of: 1.1750
The Australian Dollar/Euro Exchange Rate is currently in the region of: 0.7326
The New Zealand Dollar/Euro Exchange Rate is currently in the region of: 0.6120
(Correct as of 11:00am GMT)