The Euro to Australian Dollar (EUR/AUD) and Euro to New Zealand Dollar (EUR/NZD) exchange rates softened on Tuesday due to concerns regarding increased unemployment in Europe. The Australian Dollar, meanwhile, has strengthened after consumer confidence enjoyed a healthy surge. The New Zealand Dollar, along with its South Pacific counterpart, have also gained off the back of improved Chinese industrial profits.
The Euro to Australian Dollar exchange rate is currently trending in the region of 1.4371.
The Euro to New Zealand Dollar exchange rate is currently trending in the region of 1.6087.
Over the past few weeks the Euro has generally depreciated as traders’ faith in the European Central Bank has taken a dive amid constant stimulus initiatives. In the build-up to the results from the extensive ECB health checks on Eurozone banks, the common currency declined across the board.
However, after the results showed fewer issues than the stress tests were forecast to find, the single currency managed to rebound from the long bearish run. Those initial gains were very short-lived however, after Monday’s European economic data showed poor results from the currency bloc’s largest economy.
Both the Australian Dollar and the New Zealand Dollar have advanced over the past few weeks as trader risk-sentiment gradually improved. With less focus on geopolitical issues and global economic disparity, the high-yielding South Pacific assets are much more attractive.
The Euro to Australian Dollar exchange rate has dropped to a low today of 1.4351.
The Euro to New Zealand Dollar exchange rate has fallen to a low today of 1.6050.
On Monday the single currency managed to advance a little against its major peers. This is as a result of better-than-expected results from German economic data. Year-on-year German Import Price Index was expected to maintain the previous figure of -1.9%, but the actual result ca me in at -1.6%. On a monthly basis, the German Import Price Index climbed 0.3% following the previous month’s -0.1% decline.
However, akin to Monday’s mini Euro advance, the gains were short-lived. Mounting fears over European unemployment have weighed heavily on the common currency. ‘The Euro area is posting feeble growth,’ said Holger Sandte, chief European analyst at Nordea Markets in Copenhagen. ‘But the benchmark should be whether there’s enough growth to create jobs, and the answer unfortunately is no.’
The Australian Dollar, meanwhile, extended gains after consumer confidence showed a healthy increase. The Roy Morgan Weekly Consumer Confidence Index jumped from 111.6 to 114.6. Adding to the ‘Aussie’ (AUD) upsurge was Chinese industrial Profits which advanced from -0.6% to 0.4%.
Although there has been a complete absence of economic data pertaining to New Zealand on Tuesday, the ‘Kiwi’ (NZD) has managed a slight appreciation as a result of the Chinese data mentioned above.
Euro to Australian Dollar and New Zealand Dollar Exchange Rates Forecast to Decline
With little by way of European economic data on Wednesday the Euro is likely to extend losses. However, it may have an initial surge against the New Zealand Dollar as traders await the Reserve Bank of New Zealand rate decision.
An absence of Australian data shouldn’t hold the ‘Aussie’ back too much as trader risk-sentiment continues to flourish.