Yesterday began with poor German data, as retail sales saw just 2.5% growth compared to the market projection of 3.3% and this lowered the demand for the euro. Poor German unemployment data shortly followed, causing further movement and weakness to the euro. Later on we had the year-on-year Eurozone inflation data which was -0.1% (forecast was 0.0%), and the unemployment rate rose to 11% (despite the market projection of 10.9%). This ensured the euro lost the strength it had picked up throughout the week as expectations increased that the existing level of Eurozone quantitative easing will have to be increased.
Today we have the release of purchasing managers’ index (PMI) data from the manufacturing industry for the Eurozone and individual countries. Overall expectations are for them to be holding their own when compared to previous months and any change could well effect the euro during the course of the day.