As the European session began the Euro was trading close to a 7-week high against the US Dollar.
According to one currency strategist: ‘The Euro region’s economy shows signs of bottoming out, albeit at a very low level. A factor that’s supporting the Euro is the easing of concern over a breakup of the currency bloc.’
Another factor supporting the common currency is the better-than-forecast economic news we’ve seen over the last few weeks.
The Euro to US Dollar Exchange Rate is currently trading in the region of 1.3280 as of 11:30 GMT
And the brighter data continued today as the Italian economy was shown to have contracted by less than expected in the second quarter of the year.
Year-on-year Italian GDP shrank by 2.0 per cent in the second quarter, rather than the 2.2 per cent decline forecast. Quarter-on-quarter the nation’s economy contracted by 0.2 per cent rather than the predicted 0.4 per cent.
This data was followed by the news that German factory orders surged by significantly more than expected.
Although economists foresaw a month-on-month gain of 1.0 per cent and a YoY gain of 0.3 per cent, factory orders in the Eurozone’s largest economy actually jumped by 3.8 per cent MoM and 4.3 per cent YoY in June.
The advance was the largest for eight months, and goes a long way to brightening Germany’s economic outlook.
The Euro to US Dollar (EUR/USD) exchange rate hit a high of 1.3281 pence per Euro
In response to the data Amsterdam-based economist Aline Schuiling commented: ‘The worst could be behind us, and even though credit and demand is weak, a pick up seems to be taking shape. The German manufacturing sector should be the first the profit from a recovery in the Eurozone, and demand from there is still more important than that from Asia.’
The Euro advanced on the US Dollar as the European session progressed but gains against the Pound were limited as the British currency was supported by its own better-than-expected domestic news.
Additional EUR/GBP fluctuations could occur in response to today’s NIESR GDP estimate for the UK.
German industrial production figures are scheduled for release tomorrow.
Current Euro (EUR) Exchange Rates
< Lower > Higher
The Euro/US Dollar Exchange Rate is currently in the region of: 1.3280 >
The Euro/Pound Sterling Exchange Rate is currently in the region of: 0.8640 >
The Euro/Australian Dollar Exchange Rate is currently in the region of: 1.4773 >
The Euro/ New Zealand Dollar Exchange Rate is currently in the region of: 1.6865 <
The US Dollar/Euro Exchange Rate is currently in the region of: 0.7527 <
The Pound Sterling /Euro Exchange Rate is currently in the region of: 1.1573 <
The Australian Dollar/Euro Exchange Rate is currently in the region of: 0.6772 >
The New Zealand Dollar/Euro Exchange Rate is currently in the region of: 0.5924 >
(Correct as of 11:30 GMT)
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