Euro Weakens As German Economic Confidence Slumps Most Since 1991
17 März 2020 - 11:55AM
RTTF2
The euro fell sharply against its major counterparts in the
European session on Tuesday, after German economic confidence
plunged to its lowest level since December 2011 amid fears about
the economic fallout from the coronavirus outbreak. Survey results
from the ZEW - Leibniz Centre for European Economic Research showed
that the economic sentiment index plunged 58.2 points to -49.5 in
March
This was the biggest fall since the survey began in 1991 and
reached its lowest level since December 2011. The score was also
worse than the economists' forecast of -27.2.
At the same time, the index measuring current economic situation
declined 27.4 points to -43.1 in March. The expected reading was
-30.0.
Sentiment deteriorated as coronavirus worries offset
expectations of more stimulus.
The deadly coronavirus has so far infected 181,580 people
worldwide and killed more than 7,100, according to data compiled by
the Center for Systems Science and Engineering at Johns Hopkins
University.
The euro declined to near a 3-week low of 1.0973 against the
greenback from yesterday's closing value of 1.1180. The euro is
seen finding support around the 1.08 mark.
The euro weakened to 117.35 against the yen and 1.0545 against
the franc, from its early high of 119.69 and a 4-day high of
1.0605, respectively. Next key support for the euro is likely seen
around 116.00 against the yen and 1.04 against the franc.
The single currency pared gains to 1.8331 against the kiwi and
1.5486 against the loonie, from its early highs of 1.8560 and
1.5672, respectively. The euro is poised to challenge support
around 1.78 against the kiwi and 1.52 against the loonie.
The euro marginally dropped to 1.8231 against the aussie, after
rising to 1.8404 at 2:45 am ET, which was its strongest level since
April 2009. Immediate support for the euro is possibly seen around
the 1.61 level.
The euro was trading at 0.9077 against the pound, down from a
high of 0.9134 seen at 2:45 am ET. Should the euro slides further,
0.88 is likely seen as its next support level.
Data from the Office for National Statistics showed that the UK
unemployment rate increased at the start of the year.
The jobless rate gained 0.2 percentage points from the preceding
quarter to 3.9 percent. This was above the forecast of 3.8
percent.
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