020 7898 0500Friday was an excellent end to another impressive week for the euro, but this seemed to be driven by weakness from both sterling and the US dollar, rather than by euro strength.
The euro managed to reach fresh highs against sterling yet again, pushing further 12-month highs. This has largely been driven by negative sentiment for sterling and poor data at start the year. The single currency strengthened against the US due to worse-than-expected data from Stateside – on Friday, in particular, as downbeat economic reports pushed the euro up to two-and-a-half week highs.
Tuesday will see the first real piece of data for the Eurozone. The final Consumer Price Index (CPI) – an indicator of inflation – is released from Germany. With the previous figure being 0.3%, anything above this will be seen as a positive figure for the country, but a large change is not likely. On Wednesday we see CPI data for the Eurozone as a whole, but this is expected to remain slightly below 0%, at -0.1%, putting more pressure on concerns regarding whether the new quantitative easing is having the desired effect on the region. This programme may be an Achilles’ heel for the Eurozone in the long term, so be sure to mitigate currency exchange risk on your future euro transactions.
