Weekly Roundup: Euro wobbles amid German economy fears
Amy Richards August 29th 2023 - < 1 minute read
The euro initially wavered higher last week, despite weaker German data and warnings about the German economy. However, these concerns began to pressure EUR on Tuesday.
Wednesday saw the publication of the Eurozone’s PMI surveys. A deeper-than-expected contraction in business activity initially dented EUR, but signs of sticky inflation cushioned the currency by prompting European Central Bank (ECB) interest rate hike bets.
A darkening market mood saw the single currency creep higher against its weaker peers on Thursday, but EUR’s negative correlation with USD capped gains.
The euro ended the week with more mixed movement. A sharp decline in German business morale hurt EUR, but the currency was able to recoup its losses without a clear catalyst.
Turning to this week’s session, more poor German data is pressuring EUR. Consumer confidence in Europe’s largest economy slipped to a four-month low heading into September.
The focus moving forward is on the Eurozone’s latest consumer price index. With both headline and core inflation expected to ease, the common currency could face headwinds.
Written by
Amy Richards