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Euro US Dollar (EUR/USD) Exchange Rate Falls as German Economic Sentiment Sinks

EUR/USD Exchange Rate Down by -0.3% as Brexit and Global Trade Woes Weigh on Euro

The Euro US Dollar exchange rate fell by -0.3% today, leaving the pairing trading around $1.122 on the interbank market.

The Euro (EUR) fell against the US Dollar (USD) following today’s printing of the German ZEW survey of economic sentiment for July.

These fell to a worse-than-expected -24.5.

ZEW President Achim Wambach noted:

‘Continued negative trend in incoming orders in the German industry is likely to have reinforced the financial market experts’ pessimistic sentiment…

‘The Iran conflict seems to be intensifying and the ongoing trade dispute between the USA and China is a burden not only to Chinese economic development. Furthermore, no discernible progress has been made in the negotiations as to what Brexit will look like.’

The Eurozone’s economic sentiment survey also fell from -20.2 to -20.3.

Today’s data has heightened fears that the European Central Bank could push forward with rate cuts in the near-term.

The US Dollar, meanwhile, has edged higher against the European currency despite US markets remaining jittery following last week’s indications of a possible rate cut from the Fed as early as this month.

USD/EUR Exchange Rate Edges Higher as US Retail Sales Improve in June

The US Dollar rose against the single currency following the release of the US retail sales control group figures for June.

These rose above the consensus 0.3% to 0.7%. Month-on-month figures meanwhile beat forecasts at 0.4%.

As consumer spending has increased in the US, this has dampened expectations of an aggressive rate cut from the Fed, further bolstering the USD/EUR exchange rate.

USD traders will be awaiting the US industrial production figures for June later on this afternoon, which are expected to ease.

Later on this evening, however, Fed Chairman Jerome Powell is due to deliver a speech.

If he shows any tempering regarding the Fed’s monetary policy we would likely see the USD hold onto today’s gains.

EUR/USD Outlook: Eurozone Inflation Data in Spotlight

Euro traders will be looking ahead to tomorrow’s Eurozone inflation data for June.

Any signs of improvement could provide some uplift for the European currency.

US Dollar investors, meanwhile, will be awaiting tomorrow’s housing starts figures for June.

As these are expected to ease, we could see the ‘Greenback’ lose some of its advantage.

Tomorrow will also see the printing of the US building permits figures for June.

The EUR/USD exchange rate is likely to remain subdued, however, as political and economic tensions rise over the UK’s Brexit and continuing global economic headwinds.