In a week packed full of German data, yesterday saw the Business Climate Index reveal a better than expected show of optimism in the Eurozone’s largest economy. The data is strongly correlated to prevailing economic conditions within the Eurozone so the strong figures had a positive effect. Renewed optimism gave a boost to euro performance as it managed to hold on to gains against the US dollar after some initial volatility and strengthen moderately against sterling. Whilst positivity emanated from Germany, data showed that Spain’s economy shrank by more than anticipated in 2012 and other figures revealed that the number of French jobseekers rose to record highs in July. Following on from these business sentiment figures, today sees the release of German Consumer Climate data. If the positivity amongst German business is mirrored by consumers then we are likely to see some further euro support. Traders will also look to money supply data being released from the European Central Bank to influence performance. Money supply is positively correlated with interest rates; therefore if the data reveals that there are more euros in circulation in the Eurozone than expected, then the effect on the currency will be positive. Call your trader now to see if euro optimism will continue.