The Euro declined against several of its most traded peers today on the publication of worse-than-anticipated data for the Eurozone’s largest economy.
The Euro Exchange Rate was in the region of 1.2987 against the US Dollar as of 10:55 am GMT
According to the Federal Statistics Office, sales fell by 0.4 per cent in April – despite economists expecting an increase of 0.2 per cent. Sales were up 1.8 per cent on the year.
This marks a third consecutive month of declining sales for Germany.
Following the report’s release economist Christian Schulz stated: ‘After a host of positive news recently from the German consumer, the moderate decline in retail sales in April makes for a slightly disappointing start to the second quarter. The fundamentals for consumption in Germany remain strong. Unemployment and inflation are very low, and real wages are rising thanks to more generous wage deals between unions and employers.’
While data released earlier this week showed an unexpected increase in German unemployment, the rate of joblessness is still near a twenty year low.
In other Eurozone news, the currency bloc’s unemployment rate advanced to a new high of 12.2 per cent in April, as expected by economists.
Earlier today a separate report showed that the unemployment rate in Italy jumped from a revised 11.9 per cent in March to 12 per cent in April, significantly higher than the 11.6 per cent rate expected.
However, Euro losses were limited as Eurostat revealed that Eurozone inflation accelerated in May, with annual inflation up from 1.2 per cent to 1.4 per cent. Gains in food and services were largely responsible for the stronger-than-expected estimated figure.
Although this rise is positive, unless other signs of recovery are forthcoming the European Central Bank may have to consider taking further action.
At the central bank’s last meeting it intimated that a negative deposit rate could be considered, leading currency strategist Hans Redeker to remark: ‘I think a negative deposit rate is a clear manifestation that the ECB wants to have a weaker exchange rate. When you look at Europe’s economic performance, it has disappointed. Overall this is an economy where credit is not flowing. You have to think about how you’re going to change this’.
The ECB will issue its next rate announcement next week.
Current Euro (EUR) Exchange Rates
< Lower > Higher – Little Changed
The Euro/US Dollar Exchange Rate is currently in the region of: 1.2987 >
The Euro/Pound Sterling Exchange Rate is currently in the region of: 0.8546 <
The Euro/Australian Dollar Exchange Rate is currently in the region of: 1.3560 >
The Euro/ New Zealand Dollar Exchange Rate is currently in the region of: 1.6109 <
The US Dollar/Euro Exchange Rate is currently in the region of: 0.7683 >
The Pound Sterling /Euro Exchange Rate is currently in the region of: 1.1702 >
The Australian Dollar/Euro Exchange Rate is currently in the region of: 0.7377 <
The New Zealand Dollar/Euro Exchange Rate is currently in the region of: 0.6203 >
(Correct as of 10:55 GMT)
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