German factory orders in June came in at 1.8% month-on-month amid expectations of a 0.5% drop, the annual figure was 9.5% beating expectations of 6.7%. While the numbers look strong the reading was marred a little by the downward revisions of May’s numbers to 1.5% m/m – from 1.8% - and 11.7% y/y – from 12.2%. Factory orders in Germany have been volatile of late and are unlikely to see a protracted slowdown as we head into Q3 amid a slowing domestic and global economic outlook.
The euro was relatively unmoved as focus lies far from domestic releases on a day that is all about central banks. The action taken yesterday and this morning by the SNB and BoJ respectively to effectively weaken their domestic currencies continues to dominate price action. In addition to this action to digest the Bank of England and ECB are set to announce rates later today, with neither expected to change their benchmark rates ECB President Trichet’s press conference will be the key event.
Written by Jonathan Granby, DailyFX Research Team