ZEW survey offers little fresh hope for Germany
This morning's ZEW survey in Germany shows the economy is really under pressure, with the current conditions index dropping further from -1.1 to -13.5 against forecasts for an already weak -7.0 expected. The expectations index was even worse, recording a multi-year low of -44.1, down from -24.5 and against a very modest -27.8 expected. The latter number pointed to lows not seen since 2011.
Despite this, we still see limited movement in the EUR, though this is partly down to summer market conditions, it is clear to see that fears of a recession in Germany are really mounting, yet the single currency is still taking a relaxed view in spite of this.
We have seen EUR/CHF pressing lower today, while EUR/JPY has also clawed out new lows on the day, price action is very tight and points to low volumes. EUR/GBP is reluctant to move lower as Brexit trumps any weaknesses in Europe at the moment, though a fresh test of 0.9300 may be held off for now.
So that leaves EUR/USD, which as we have said in recent weeks, is moving largely to the tune of the USD. Should we get any USD positives over coming sessions - and we have inflation later today, we can expect some catch-up play here, but as we have seen, 1.1160-50 seems to be providing decent support for now.