The Euro has weakened against the majority of its peers after the latest economic data out of the Eurozone painted a grim picture of the true state of the region.
The Eurozone’s two biggest economies, France and Germany, both posted larger than expected contractions in their economies for the final quarter of 2012. Germany- the region’s largest economy- saw its Gross Domestic Product (GDP) fall by 0.6% thanks to a decline in the demand for exports. The surprise decline is the deepest contraction since the height of the financial crisis in 2009.
The German statistics office said: “Comparatively weak foreign trade was the decisive factor for the decline in the economic performance at the end of the year: in the final quarter of 2012 exports of goods declined significantly more than imports of goods.”
The disappointing GDP figures combined with yesterdays record high unemployment data from Portugal to weigh down the single currency. Spain recently released figures that showed that the regions fourth largest economy remains deep in recession after posting a 0.7% contraction.
The struggling French economy posted a contraction of 0.3% in the final quarter supporting some analyst belief that the nation is heading for a deep recession. The French Central Bank however disagrees after recently stating that it believes the French economy will expand in the first quarter of 2013 but French Prime Minister Jean-Marc Ayrault acknowledged for the first time on Wednesday that weak growth was putting his government’s deficit goal for 2013 out of reach.
As of 10:00 am
The Euro to Pound Sterling exchange rate is currently trading in the region of 0.8617
The Euro to US Dollar exchange rate is currently trading in the region of 1.3375
The Euro to Australian Dollar exchange rate is currently trading in the region of 1.2916
The Euro to New Zealand Dollar exchange rate is currently trading in the region of 1.5721
The Euro to Canadian Dollar exchange rate is currently trading in the region of 1.3394
The Euro to Emirati Dirham exchange rate is currently trading in the region of 4.9156
The Euro to Swiss Franc is currently trading in the region of 1.2319
The Euro to Japanese Yen exchange rate is currently trading in the region of 125.115
