The Euro has softened despite today’s positive data, after news that German banking giant Deutsche Bank will not pay out bonuses to its senior executives after it was revealed on Thursday that the institution made huge losses in 2015. Meanwhile, the Canadian Dollar is making strong rises following news that the economy grew after three months of mild recession.
Deutsche Bank Shock Steals Focus from Positive Eurozone Inflation Data: EUR/CAD Tumbles
Eurozone Consumer Price Index figures for today have printed better-than-expected, showing an uptick in inflation that will surely cheer economists, central bankers and investors alike. Core prices increased by 1%, up from the previous level of 0.9%, the rate at which growth was anticipated to remain steady. Monthly inflation accelerated from 0.2% to 0.4% as expected.
However, the news has failed to keep the Euro in positive territory as events at Deutsche Bank steal attention. On Thursday the banking giant reported that it had lost €6.8 billion, with just under a third of total losses made in the final quarter of 2015. As a result of the news, Deutsche Bank has ruled that it will not pay top executives a bonus for the 2015 period. It’s the first non-pay out of bonuses since 2008.
According to Deutsche Bank co-chief executive, John Cryan, ‘It would be inappropriate vis-à-vis society to post €5.2bn in legal provisions in one year and not reflect that in compensation, particularly when the share price has fallen, and shareholders have suffered. By and large, I think we are underpaying against our international peer group this year and I hope that many staff understand why.’
The Euro has fallen -0.7% against the Canadian Dollar, with the EUR/CAD exchange rate trading around 1.5233.
Canadian Dollar to Euro (CAD/EUR) Exchange Rate Bullish: Economy Posts First Growth for Three Months
The ‘Loonie’ has been strengthened today after GDP figures showed that the Canadian economy grew in November, ending a mild recession after three straight months of contraction. A 0.3% year-on-year (YoY) rise in GDP to C$1.65 trillion (€1.08 trillion) in November saw the economy rise in line with expert predictions. The data comes shortly after Canadian investment banking company CIBC World Markets downgraded its 2016 GDP outlook for the second time, taking it from 1.5% to 1.3%.
The Canadian Dollar could also be gaining strength from the fact that oil prices have managed to hold onto their gains today after moving away from the US$30 mark, currently remaining around US$34.50.
The Canadian Dollar to Euro (CAD/EUR) exchange rate is currently trading between 0.6499 and 0.6594.
Euro to Canadian Dollar (EUR/CAD) Exchange Rate Forecast: Eurozone Data will Dominate until Friday
There is little data out for Canada until Friday, when key employment figures are released. The Eurozone, however, sees a slew of releases, although many have to potential to be largely ignored unless there is little news or world developments to give traders direction. Key among the data will be German unemployment figures, due on Tuesday.
The Euro to Canadian Dollar (EUR/CAD) exchange rate is currently trading between 1.5141 and 1.5388.