Euro-Zone Industrial New Orders in April Advances for a Third Straight Month

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EUR/USD: Industrial new orders in April rose 0.9 percent after rising a revised 5.1 percent the previous month. At the same time, the annualized rate soared 22.1 percent, missing expectations of 21.8 percent, the Eurostat in Luxembourg showed today. Indeed, figures rose for a third consecutive month, however, it is noteworthy that the three month change soared 6.1 percent compared to March’s reading which advanced 3.1 percent. Looking at the breakdown of the report, intermediate goods orders lead the rally, climbing 1.7 percent, while non-durable consumer orders tapered the increase, falling 2.1 percent.  Under “normal” conditions, an increase in industrial orders typically signals for increased production and a rising GDP. However, as governments aim to scale back stimulus measures amid ballooning budget deficits, we may see the 16-member euro area face an economic downturn later on this year. Away from the economic docket, ECB president Trichet said that the euro is a “very credible currency” and went onto say that austerity “doesn’t strangle” recovery. To discuss this and other topics, please visit the EUR/USD forum.


Written by Michael Wright, Currency Analyst
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