Following a pretty disastrous day for the Euro yesterday, the common currency was able to strengthen against the Pound and US Dollar this morning following the release of German growth figures.
The Euro to US Dollar exchange rate is currently trading in the region of 1.3491
The Euro tumbled against the majority of its currency counterparts as Eurozone services and manufacturing PMI came in below estimate and consumer confidence in the currency bloc unexpectedly declined.
However, after European Central Bank President Mario Draghi attempted to quell concerns regarding the potential use of negative interest rates to spur economic growth, the Euro recovered some ground. The currency went on to consolidate and extend gains this morning.
As expected by economists the German economy expanded by 0.3 per cent in the third quarter (quarter-on-quarter) and 0.6 per cent year on year.
German construction investment came in above forecasts with a gain of 2.4 per cent and capital investment also exceeded expectations.
However, German exports were an area of disappointment, with growth of just 0.1 per cent. Economists had predicted an increase in exports of 0.3 per cent. However, the second quarter gain was upwardly revised to 2.4 per cent.
The Euro is currently trading against the US Dollar in the region of 1.3409
The data confirms that German growth is slowing, and that poor external demand is being countered by an improving domestic situation.
Hanover-based economist Jens Kramer said this of the results; ‘The German economy has entered a slow but steady growth path. That distinguishes it from the Euro area.’
Before the weekend additional Euro movement is likely to occur in response to the German IFO business assessment/current assessment/business climate surveys.
With all the surveys coming in above the forecast levels the Euro may well extend gains in the hours ahead.
The measure of business expectations advanced from a revised 103.7 to 106.3 while the current assessment index rallied from 111.3 to 112.2 and the business climate measure rose from 107.4 to 109.3.
Euro (EUR) Exchange Rates
As of 09:00 GMT
The Euro/US Dollar Exchange Rate is currently in the region of: 1.3491 >
The Euro/Pound Sterling Exchange Rate is currently in the region of: 0.8324 <
The Euro/Australian Dollar Exchange Rate is currently in the region of: 1.4684 >
The Euro/ New Zealand Dollar Exchange Rate is currently in the region of: 1.6392 <
The Euro/ Canadian Dollar Exchange Rate is currently in the region of: 1.4225 >