The day started off on a poor note for the euro but had almost no effect on the market when French consumer confidence fell slightly from 97 to 96, and German consumer confidence held steady, remaining at the same level as the previous month. Following this, it was a positive day for the euro, particularly after ECB member Hansson stated that ‘he sees no convincing reason for further policy action at the next meeting’. This pushed expectations for any further quantitative easing back until December. Then the US Federal Reserve held their press conference and the euro went into freefall against the US dollar and sterling as the likelihood of the US increasing interest rates pre-Christmas increased significantly.
After a couple of quiet days on the data front for the euro, today is likely to have an impact on the market. Germany unemployment data is forecast to remain at 6.4%. The consumer price index (CPI) from Germany is expected to increase slightly from -0.2 up to -0.1%. Investors will be watching this closely as the CPI is a measure of inflation.