The Euro has edged up against the British Pound after the latest German IFO Business climate data showed that the mood in Europe’s biggest economy is improving, raising slim hopes that the Eurozone recession may be close to ending.
According to the IFO economic institutes closely watched business climate index confidence in the German economy climbed to 105.9 in June from 105.7 in May, in line with economist forecasts.
The measure of confidence is one of the leading indicators of the likely trend of activity.
“Today’s Ifo index is really good news,” said UniCredit economist Andreas Rees.
The improvement in business expectations “conveys a powerful message to financial markets. German companies have been able to withstand the recent downward pressure coming from the Chinese economy. This is not a small achievement,” Rees said.
While the increase was much more modest than the rise in the Ifo index seen in May, it showed that the German economy “is continuing to hold its course, Although assessments of the current business situation are slightly less positive, firms are increasingly optimistic with regard to their future business outlook” insisted Ifo economist Kai Carstensen.
Monday’s data adds to the increasing speculation that the Eurozone is close to turning a corner and finally make a start on a recovery. The rise in business confidence follows other recent data releases which showed that consumer confidence in the Eurozone as a whole is improving.
The German government expects the nation’s economy to pick up the pace in terms of growth in the second quarter of the year despite industrial orders continuing to decline and unemployment rising.
Risks to confidence are still high and any signs of recovery remain vulnerable. The failure of European finance ministers to agree on how to share the cost of bank collapses highlights just how divided the regions leadership is.
Current Euro (EUR) Exchange Rates
The Euro/US Dollar Exchange Rate is currently in the region of: 1.3104
The Euro/Pound Sterling Exchange Rate is currently in the region of: 0.8526
The Euro/Australian Dollar Exchange Rate is currently in the region of: 1.4293
The Euro/ New Zealand Dollar Exchange Rate is currently in the region of: 1.6994
The US Dollar/Euro Exchange Rate is currently in the region of: 0.7631
The Pound Sterling /Euro Exchange Rate is currently in the region of: 1.1728
The Australian Dollar/Euro Exchange Rate is currently in the region of: 0.6996
The New Zealand Dollar/Euro Exchange Rate is currently in the region of: 0.5895
(Correct as of 12:40pm GMT)