Euro Advances As Eurozone GDP Matches Flash Estimate, German ZEW Index Climbs
16 Maggio 2017 - 9:20AM
RTTF2
The euro climbed against its most major counterparts in the
European session on Tuesday, after German investor sentiment
improved in May and the euro area economy expanded as initially
estimated in the first quarter, indicating improved growth
prospectus in the currency bloc.
Flash data from Eurostat showed that gross domestic product
climbed 0.5 percent sequentially, the same pace of growth as seen
in the fourth quarter. The rate came in line with preliminary flash
estimate published on May 3.
On a yearly basis, GDP growth slowed slightly to 1.7 percent
from 1.8 percent in the fourth quarter. The annual rate also
matched initial estimate.
Survey data from the Mannheim-based Centre for European Economic
Research/ZEW showed that German economic confidence continued to
improve in May.
The ZEW Indicator of Economic Sentiment rose 1.1 points to 20.6
in May. This was the highest score since August 2015 but below the
expected level of 22.0.
The current conditions index climbed 3.8 points to 83.9
points.
Preliminary data from Eurostat showed that the euro area trade
surplus increased in March from a month ago, as exports rose and
imports fell.
The seasonally adjusted trade surplus rose to a 3-month high of
EUR 23.1 billion in March from EUR 18.8 billion in February.
Economists had expected a surplus of EUR 18.7 billion for the
month.
Meanwhile, European shares are trading mixed, as a stronger euro
weighed on regional exporters and London copper prices slipped on
concerns over slowing economic growth in China.
The Washington Post reported that U.S. President Donald Trump
revealed "highly classified information" about a planned Islamic
State Operation to two top Russian officials last week, with
lawmakers calling the alleged disclosures "inexcusable" and "deeply
disturbing."
However, U.S. National Security Adviser H.R. McMaster denied the
accuracy of published reports, saying the conversation covered only
a range of common threats and did not include operations not
already known publicly.
The euro showed mixed performance in the Asian session. While
the euro held steady against the yen and the pound, it fell against
the franc. Against the greenback, the euro rose.
The euro firmed to 1.1059 against the greenback, a level unseen
since November 2016. The euro is likely to find resistance around
the 1.12 mark.
Having fallen to 124.59 against the Japanese yen at 10:30 pm ET,
the euro advanced to more than a 1-year high of 125.64.
Continuation of the euro's uptrend may see it challenging
resistance around the 128.00 region.
Figures from the Ministry of Economy, Trade and Industry showed
that Japan's tertiary activity index decreased unexpectedly in
March.
The tertiary activity index dropped 0.2 percent month-over-month
in March, after remaining flat in February. Meanwhile, economists
had expected a 0.1 percent increase for the month.
The euro strengthened to 0.8579 against the pound, its strongest
since April 7. The pair ended Monday's trading at 0.8511. The euro
is seen finding resistance around the 0.87 area.
Data from the Office for National Statistics showed that UK
inflation accelerated to the highest since 2013 largely due to
higher air fares in April.
Inflation rose more-than-expected to 2.7 percent in April from
2.3 percent in March. Inflation was forecast to rise to 2.4
percent.
The 19-nation currency spiked up to an 11-day high of 1.5100
against the loonie, near a 1-year high of 1.6107 against the kiwi
and an 8-month high of 1.4950 against the aussie, off its early
lows of 1.4951, 1.5906 and 1.4774, respectively. The next possible
resistance for the euro is seen around 1.52 against the loonie,
1.62 against the kiwi and 1.51 against the aussie.
The euro held steady at 1.0946 against the franc, after touching
a 4-day peak of 1.0960 at 4:30 am ET. The pair was valued at 1.0937
when it finished Monday's trading.
Looking ahead, U.S. building permits, housing starts and
industrial production for April are set for release in the New York
session.
At 11:30 am ET, the European Central Bank Governing Council
member Ewald Nowotny speaks about monetary policy at an event
hosted by the Principality of Liechtenstein, in Vienna.
The European Central Bank board member Benoit Coeure speaks at
the annual dinner of the ECB's Bond Market Contact Group in
Frankfurt, Germany at 1:00 pm ET.
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