Euro Weakens After German Economic Confidence Deteriorates
16 October 2018 - 6:29PM
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The euro dropped against its major counterparts in the European
session on Tuesday, as a data showed that Germany's economic
confidence weakened in October.
Survey data from the Centre for European Economic Research, or
ZEW, showed that the economic sentiment index fell sharply by 14.1
points to -24.7 in October. The expected score was -12.
The indicator reached the same low-point as in July of this
year, being at its lowest reading since August 2012.
The assessment of the current economic dropped 5.9 points to
70.1, which was well below the expected 74.4 level.
European shares were mixed as investors watched geopolitical
developments in the Middle East and looked ahead to the release of
minutes of the U.S. Federal Reserve's latest policy meeting, due
Wednesday for directional cues.
In other economic news, figures from Destatis showed that
Germany's import prices rose at a steady pace in August.
Import prices advanced 4.8 percent year-on-year in August, the
same pace of increase as seen in July. Economists had forecast the
rate to accelerate to 5.2 percent.
The euro traded mixed against its major counterparts in the
Asian session. While it fell against the greenback and the yen, it
held steady against the pound. Against the franc, it rose.
The euro pared gains to 1.1435 against the franc, from a high of
1.1457 hit at 4:00 am ET. The next possible support for the euro is
seen around the 1.12 level.
The single currency pulled back to 1.1566 against the greenback,
after rising to 1.1599 at 3:45 am ET. The euro is poised to target
support around the 1.13 area.
The euro depreciated to a 4-day low of 0.8753 against the pound,
off its previous high of 0.8810. If the euro falls further, it may
find support around the 0.86 area.
After rising to a 4-day high of 130.06 against the yen at 3:45
am ET, the euro reversed direction with the pair trading at 129.72.
On the downside, 128.00 is possibly seen as the next support level
for the euro.
The common currency declined to a 6-day low of 1.5005 against
the loonie, reversing from a high of 1.5058 touched at 3:30 am ET.
Next key support for the euro is seen around the 1.49 level.
The euro retreated to 1.6236 against the aussie, after having
advanced to a 4-day high of 1.6285 at 3:15 am ET. The euro has set
a 4-day low of 1.6208 at the commencement of today's trading. The
euro is seen finding support around the 1.60 mark.
The euro fell back to 1.7583 against the kiwi, heading to pierce
near a 2-week low of 1.7558 hit at 5:45 pm ET. The euro is likely
to challenge support around the 1.74 region.
Looking ahead, U.S. industrial production for September and NAHB
housing market index for Ocober are scheduled for release in the
New York session.
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