The Euro briefly firmed against the Pound after UK GDP data matched economist forecasts and consumer confidence in Germany came in better-than-expected.
Early on Wednesday morning the news broke that German Chancellor Angela Merkel’s Christian Democratic Party reached a deal with the Social Democrats to form a coalition government. The deal was reached following a long night of negotiations between the two sides but finally issues were resolved regarding the implementation of a minimum wage and increased spending on infrastructure and welfare.
As a result of the deal the Euro received a boost against its peers as confidence returned to the region. Germany had been without a government for more than two-months after Angela Merkel won re-election without a majority.
“The Euro was boosted by the news that Germany is close to reaching a coalition accord. I don’t think the currency will extend gains much from here,” said an economist at Barclays Plc.
The currency also found support from the release of a consumer confidence report out of the region’s largest economy. The GFK Consumer confidence survey said that confidence is likely to rise to 7.4 in December, up from the 7 recorded in November. The figure is better than the 7.1 predicted by economists.
The Euro was unable to take full advantage of the news out of Germany however after separate data releases from France and Spain showed that the two nations’ economies are continuing to weaken.
Year on year Spanish retail sales dropped from the 2.2% rise recorded in September to -0.5% in October, the figure was slightly better than forecasts. France meanwhile saw consumer confidence drop to 84, below the 85.59 expected by the markets.
As news of the UK GDP data filtered through into the markets the Pound managed to edged higher against the Euro but is likely to remain range bound as investors wait for this afternoons data releases from the United States.
Euro (EUR) Exchange Rates
As of 10:00 am GMT
The Euro/US Dollar Exchange Rate is currently in the region of: 1.3609
The Euro/Pound Sterling Exchange Rate is currently in the region of: 0.8364
The Euro/Australian Dollar Exchange Rate is currently in the region of: 1.4924
The Euro/ New Zealand Dollar Exchange Rate is currently in the region of: 1.6610
The Euro/ Canadian Dollar Exchange Rate is currently in the region of: 1.4349
The Euro/ Japanese Yen Rate Exchange Rate is currently in the region of: 138.4702
The Euro/Swiss Franc Exchange Rate is currently in the region of: 1.2309
The Pound Sterling/ Euro Exchange Rate is currently in the region of: 1.1952
The US Dollar/Euro Exchange Rate is currently in the region of: 0.7347
The Australian Dollar/Euro Exchange Rate is currently in the region of: 0.6702
The New Zealand Dollar/Euro Exchange Rate is currently in the region of: 0.6020
The Canadian Dollar/Euro Exchange Rate is currently in the region of: 0.6971
Swiss Franc/Euro Exchange Rate is currently in the region of: 0.8124
