The past week has seen the Euro to US Dollar (EUR/USD) exchange rate fluctuate dramatically as the repercussions of the December FOMC and ECB policy meetings continue to be felt.
In terms of ecostats for the Eurozone, the Euro has been met with a trilogy of contrasts so far this week. Monday saw German Producer Prices for November ‘improve’ from -0.4% to -0.2% on the month and clearly deteriorate from -2.3% to -2.5% on the year.
However, the effect of this was countered somewhat by a barely better-than-expected Eurozone Consumer Confidence result for December, which shifted from -5.9 to -5.7.
Tuesday saw further disappointment for investors with more German negativity, this time concerning the November Import Price indices.
In a continuation of the contrasting movement for the Euro, it was actually propelled upwards by the German Gfk Consumer Confidence Survey for January, which advanced fractionally from 9.3 points to 9.4.
Today, the Euro has been put in the pits by data from France, which has seen the country’s Q3 GDP fall from 1.2% to 1.1% on the year. With no further impactful Eurozone data out today, this downtrend seems set to continue for the immediate future.
The US Dollar has had a mixed performance in terms of responses to domestic data, but for the most part the ‘Buck’ has risen to the challenge and remained above water against its major peers. Monday saw little real movement due to the scarcity of impactful data, but yesterday the US currency was devalued heavily in the afternoon by the Existing Home Sales for November declining greatly from -4.1% to -10.5% when an improvement to -0.4% had actually been predicted.
For the remainder of the week, Euro/US Dollar exchange rate movement may occur as a result of Belgium’s October Industrial Production results (out tomorrow), along with France’s Unemployment Benefit Claims and Total Jobseekers figure for November, also out tomorrow. On the US side of things, input will be had by the Initial and Continuing Claims figures up to December 19
th
and December 12
th
respectively.
At the time of writing, forecasts were for the Belgian data to show improvement on both the month and year.
From the US, movement can be expected to occur if applications for unemployment benefits fall in both categories as has been predicted.