THE TAKEAWAY: German GFK consumer confidence survey at 5.6 -> Consumers say they are less willing to spend -> Euro temporarily traded lower
German consumer confidence has set a new yearly low according to the GFK survey. The survey for January dropped to 5.6, lower than both an expected 5.9 and December’s revised 5.8 survey result. The survey is based on interviews with about 2000 consumers.
Business expectations among consumers fell to -17.9 in December from -14.6 according to GFK. Income expectations rose to 21.2 but willingness to buy dropped over nine points to 20.1 according to December’s survey.
The Bundesbank recently cut its economic forecast for 2012 and 2013, and the ECB expects the Euro-zone will begin a rebound well into 2013. Euro investors continue to look for signs of economic stabilization and an end to the debt crisis.
The Euro temporarily lost some ground following the lower than expected survey results. However, the drop was quickly erased as EURUSD climbed back above 1.3200. The pair might next see resistance by an 8-month high set at 1.3308, and support could be provided by the former resistance around 1.3158.
EURUSD Daily: December 21, 2012