The Euro to Canadian Dollar (EUR/CAD) exchange rate firmed to a session high of 1.431 on Friday as the latest Growth Domestic Product (GDP) data for Germany and the wider Eurozone came in better than expected.
The Euro to Canadian Dollar Exchange Rate Hit A Session High of 1.431
Prior to the release of the GDP data, the Canadian Dollar had been trading higher against the Euro and a number of other major peers as a rally in oil prices supported the ‘Loonie’.
West Texas Intermediate oil advanced by more than $2 and Brent Crude rose by $3. The cause for the rise in the commodity’s prices was a cut back in investment by oil companies and the disruption of oil exports from Kuwait following a dust storm.
The Euro then received a boost against the majority of its most traded peers from the release of GDP data out of Germany and other Eurozone members.
The German GDP report showed that the region’s largest economy expanded at a pace that was more than twice the 0.3% increase expected by economists. The figure was also up from the preceding quarter’s growth rate of 0.1%. On a year on year basis, the German economy grew by 1.6% beating expectations for a figure of 1%. The strong data now means that Germany has surpassed the UK as the fastest growing European economy.
‘Germany has retaken its role as economic growth engine in the Euro area. High geopolitical uncertainty has hardly had any damping impact in the fourth quarter, although the result will be exaggerated somewhat due to unusually mild weather at the beginning of the winter,’ said an economist at Munich based BayernLB.
The wider Eurozone also expanded at a faster than forecast rate. The data showed that GDP in the currency bloc grew by 0.3% quarter on quarter and increased by 0.9% on a year on year basis. Economists had been forecasting for a quarterly rise of 0.2% and an annual increase of 0.8%.
‘It is not a story of here comes the boom, but we are starting to see signs of a more convincing recovery,’ said Nick Kounis from ABN Amro Bank NV Amsterdam.
France, Cyprus, Greece, Finland and Italy however all continue to suffer from weak growth or contractions, showing that there is still a long way to go before the Eurozone can say a full-scale recovery are underway.
Euro Exchange Rate News:
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