Euro Boosted As German Industrial Production Bounces Back
- German industrial production rose 2.8% in January.
- That’s the best performance since August 2016.
- EURGBP rises to 0.8676.
The Euro strengthened in early European trading Wednesday after data showed German industrial production, which makes up 30% of the Euro-Zone’s largest economy, grew at its quickest pace in January since August last year.
The sector expanded 2.8% in the month, according to official data from the Federal Statistical Office (Destatis), bouncing back from the revised 2.4% drop in December, and slightly higher than the 2.7% market estimate.
The data also defy poor factory orders data released earlier this week that showed a drop of 7.4%, the worst month in eight years, driven by slowing domestic demand.
Destatis said the drop in industrial production in December was a blip, likely caused by factories closing due to poor weather. It added that the positive momentum was likely to build in the coming months.
The Euro has been in a tight range versus the US Dollar, but the strength gained on recent positive data from the Euro-Zone has been evident against the British Pound, which is being held back by weak data and Brexit uncertainty.
EURGBP has gained a further 0.0015 in early Wednesday trading to reach 0.8676. No one, however, at this stage expects the European Central Bank to drop its interest rate easing bias when it announces a policy decision tomorrow.
EURGBP 15-Minute Chart (Intraday, March 08 2017)
--- Written by Oliver Morrison, Analyst
To contact Oliver, email him at firstname.lastname@example.org
Don't trade FX but want to learn more? Read the DailyFX Trading Guides
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.