THE TAKEAWAY: German retail sales data mixed -> Germany’s struggles with lagging growth -> Euro bearish on the day after consolidating its losses over the last two sessions
Mixed data out of Germany today showed retail sales rising by 0.7% in October, while economists had predicted a more muted rise of 0.1%. Last month’s figure was revised down to 0.3%. On the flip side, the yearly retails sales figure showed a loss of -0.4%, well below the forecasted 2.0% rise. The yearly data was not seasonally adjusted.
Despite remaining Europe’s largest and most healthy economy, Germany has recently been struggling with lagging growth as the credit fallback from nations like Italy and Greece reaches into the Eurozone heartland. Germany failed to find bids for nearly a third of bunds in a recent bund auction, and although the tab was eventually picked up by the ECB, the shock made the Euro plummet to new lows.
Although the Euro has rallied in recent days, Wednesday price action appears to show the Euro and other risk-correlated currencies reversing their gains and resuming their weakness in favor of the US Dollar.
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