The Euro had a negative week of trading last week as concerns grew that the Eurozone recovery has stalled and instead the region is on the brink of contracting yet again as inflation data from the previous week was far weaker than forecast and industrial production fell.
At the start of the week the single currency rallied against most of its peers during Monday’s session after speculation grew that the currency’s declines in the previous week were exaggerated. News that inflation fell to its slowest pace in four years and the surprise interest rate cut by the Bank of England saw the Euro tumble.
The currency found support from news that the Greek Prime Minister Antonis Samaras survived a vote of confidence, easing some nerves amongst investors. It also benefitted from a decline in emerging currencies in Asia. Asian currency’s fell in the aftermath of Typhoon Haiyan.
On Tuesday the currency made further against the Pound, Australian Dollar, New Zealand Dollar and US Dollar due to the release of disappointing data out of many of those nations causing a decline in sentiment. The commodity based and emerging market currencies were weakened by increased speculation that the Federal Reserve could taper its monetary easing programme as soon as December.
The currency then fell on Wednesday against all of its peers after data showed that industrial production in the Eurozone fell in September. The data increased concerns that the region’s economy is slowing. The currency tumbled further in the afternoon after a European Central Bank governing council member warned that the bloc’s low interest rates come with risks that must be addressed.
The Euro weakened again on Thursday against the Pound and US Dollar after data showed that the Eurozone’s GDP expanded slower than expected in the third quarter of the year. According to the Luxembourg based statistics office, GDP in the Eurozone increased by just 0.1% in the third quarter, down from the previous growth rate of 0.3% expansion recorded in the previous quarter. The figure was below the 0.14% increase forecast by economists. Germany expanded slower than expected and France contracted, increasing worries that the region’s economic recovery is faltering.
As the week drew to a close the Euro was able to recover to close near a one-week high against the US Dollar after weak data weighed upon the Dollar. Against the Pound the Euro was softer on concerns that the UK economy is powering ahead and as official data from the Eurozone showed that consumer price inflation remained unchanged in October at an annualized rate of 0.7%, in line with expectations.
Today the Euro has firmed against the Pound and other peers after the region’s balance of trade data came in higher than economic forecasts.
Euro (EUR) Exchange Rates
As of 11:30 am GMT
The Euro/US Dollar Exchange Rate is currently in the region of: 1.3504
The Euro/Pound Sterling Exchange Rate is currently in the region of: 0.8378
The Euro/Australian Dollar Exchange Rate is currently in the region of: 1.4353
The Euro/ New Zealand Dollar Exchange Rate is currently in the region of: 1.6111
The Euro/ Canadian Dollar Exchange Rate is currently in the region of: 1.4076
The Euro/ Japanese Yen Rate Exchange Rate is currently in the region of: 134.9779
The Euro/Swiss Franc Exchange Rate is currently in the region of: 1.2333
The Pound Sterling/ Euro Exchange Rate is currently in the region of: 1.1936
The US Dollar/Euro Exchange Rate is currently in the region of: 0.7405
The Australian Dollar/Euro Exchange Rate is currently in the region of: 0.6967
The New Zealand Dollar/Euro Exchange Rate is currently in the region of: 0.6206
The Canadian Dollar/Euro Exchange Rate is currently in the region of: 0.7104
Swiss Franc/Euro Exchange Rate is currently in the region of: 0.8107
Key events for the week ahead
Tuesday November 19th – German ZEW economic sentiment Index
Thursday November 21st – Eurozone Markit Services PMI
Eurozone consumer confidence
Friday November 22nd – Eurozone Group Meeting
German GDP Growth Rate
