Better-than-expected employment data caused the euro to perform well yesterday, as we saw moderate appreciation against both sterling and the US dollar. German unemployment figures revealed a decrease in the number of people not in employment for the fourth month running, which had a positive impact on euro performance. Similarly, the rate of unemployment for the Eurozone as a whole was revealed to be marginally better than expected, at 11.9% for the month of March – a 0.1% reduction in rate from February. Expectations of an interest rate change have largely subsided in recent weeks, but key economic indicators such as unemployment figures continue to have a notable impact on euro rates.
This morning, unemployment figures from Spain could influence the performance of the single currency, especially if it indicates whether or not the more troubled Southern European states are following Germany’s lead and seeing reduction in levels of unemployment. The European Central Bank (ECB) makes its monthly interest rate decision tomorrow and while – as mentioned – we are unlikely to see further changes at this stage, the following press conference has considerable potential to spur on trader activity.
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