Confidence in the Eurozone declined more than expected and for a second straight month in April, increasing investor speculation that the European Central Bank will cut interest rates later in the week.
The decline in confidence follows a series of disappointing economic factors out of the debt and recession ridden region including the botched bailout of Cyprus, which did little to calm nerves. According to the Brussels based European Commission the index of executive and consumer sentiment declined to 88.6, the lowest figure since December 2012. Economists had been expecting a decline to 89.3.
Causing the biggest concern is the lack of confidence that has seeped into the regions heartland with even Germany, Europe’s biggest economy suffering a decline of 2.3 points in confidence. Morale has also fallen in Italy and France, meaning that Europe’s biggest three economies are all suffering from declines in confidence.
Adding to the decline n confidence was the release of the latest Business Climate Indicator which declined from -0.75 to -0.93. Consumer sentiment improved slightly, but was still deep in negative territory at minus 22.3, from minus 23.5 in March.
Despite the plethora of weak data the Euro has maintained its gains against the US Dollar as it continues to benefit from the end of political stalemate in Italy. The country managed to see success in the bond markets as traders gave a show of support for the new Prime Minister Enrico Letta.
The currency could weaken later in the day however, as the last German consumer Price index is set to be released. A worse-than-expected figure for that could see investors look to safe-havens.
Current Euro (EUR) Exchange Rates
The Euro/US Dollar Exchange Rate is currently in the region of: 1.3078
The Euro/Pound Sterling Exchange Rate is currently in the region of: 0.8419
The Euro/Australian Dollar Exchange Rate is currently in the region of: 1.2658
The Euro/ New Zealand Dollar Exchange Rate is currently in the region of: 1.5335
The US Dollar/Euro Exchange Rate is currently in the region of: 0.7634
The Pound Sterling /Euro Exchange Rate is currently in the region of: 1.1860
The Australian Dollar/Euro Exchange Rate is currently in the region of: 0.7893
The New Zealand Dollar/Euro Exchange Rate is currently in the region of: 0.6517
(Correct as of 10:40 am GMT)
Comments are closed.