The Euro is off to a disappointing start in today’s European session after the release of key data from Germany showed the Eurozone still has some way to go with regards to its economic recovery
Industrial production figures from the Eurozone’s biggest economy hit the market at -1.3% against analysts’ expectations for a figure of 0.5% while on a yearly basis, the figures were even more disappointing coming in at 5.1% in June versus 11% expected by the market and well down from tne16.6% growth reported in May.
Surprisingly the European currency has only fallen around 5 pips against its US counterpart on the back of this news which means investors are prepared to overlook this and wait to see the outcome of the all-important non-farm payrolls figure due for release from the US later today.
The NFP number expected by the market is 870k and anything above this is bound to once again put the US Federal reserve in focus with regards to interest rate hike and reducing their stimulus program.
A better than expected figure would also likely put serious pressure on the Euro and we may see a retest of the 4 month low reached at the beginning of April.
On the chart we can see that the EUR/USD currency pair is headed for its 6 straight day of losses and in yesterday’s trading session the pair broke down through the critical support level of $1.1838 where it remains today.
As was mentioned above, the direction of this currency pair today will be dictated by the release of the NFP and only a disappointing set of numbers will give the Euro some reprieve and put an end to the current downtrend.