Euro Looks Past Soft German IFO Data as Markets Digest Fed Hike
- The Euro was little changed versus its major currency counterparts
- IFO business climate index dropped to 108.7 from 109.0 in November
- Business expectations unchanged 104.7, but below expectations
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The Euro was little changed versus its major currency counterparts after today’s German IFO figures fell below expectations. The German Business Climate index dropped to 108.7 in December, below the prior and expected print of 109.0 (the further the value is from 100, the stronger the sentiment). The expectations index remained unchanged at 104.7, but fell below the 105.0 figure expected by economists. The Current Assessment number was perhaps the most interesting part in the current market context, which printed 112.8, below the prior and expected figure of 113.4.
The drop in the Current Assessment might be seen as worries stemming from slower exports due to a slowdown in emerging markets. The effects has been offset by steady domestic demand, but may be put in higher focus after yesterday’s rate hike by the Federal Reserve, which may put additional pressure on emerging markets economies. With that being said, it seems the move by the Fed is still in high focus today as the market digests this latest development, trying to decide the path forward. Given this fact the Euro was little changed versus its major currency counterparts.
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