Weekly Roundup: Euro volatile amid mixed data and ECB decision

Roxane Cody December 18th 2023 - < 1 minute read

The euro stumbled at the start of the week, with traders repositioning ahead of the European Central Bank’s (ECB) interest rate decision.

The single currency was able to recover on Tuesday thanks to upbeat German data. The influential ZEW economic sentiment index unexpectedly rose to a nine-month high in December, cheering EUR investors.

Weaker-than-expected Eurozone industrial production then saw the euro waver midweek, although a tumbling US dollar lent the currency support due to their negative correlation.

The ECB decision on Thursday then buoyed the common currency, as the bank sounded more hawkish than anticipated.

However, EUR stumbled on Friday after the Eurozone’s PMI results fell short of forecasts, raising recession fears in the bloc.

This week, the euro got off to a muted start after Germany’s latest business climate indicator showed a surprise deterioration in business morale this month.

For the euro, the week before Christmas looks set to be a quiet one. The only upcoming releases of note are the finalised Eurozone CPI figures and German consumer confidence.

Confirmation of cooling Eurozone inflation could pressure EUR, while a modest improvement in German household morale may lend the currency some support.

Written by
Roxane Cody

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