The single currency continued to strengthen amidst further positive indicators for the Eurozone. Germany’s private sector grew at the fastest pace in nearly six years in March. This number represented a 70-month high.
The purchasing managers’ index, which tracks activity in the manufacturing and services sectors, rose to 57 from 56.1 in February. In addition, we also saw solid growth in French and Eurozone-wide PMI figures.
It’s going to be a busy week for the Eurozone data-wise. Today we have the German IFO data released, which is a survey of about 7,000 businesses, asking them what their expectations are for the coming six months. It’s a leading indicator of economic health as businesses react quickly to market conditions.
On Wednesday, it will be interesting to see if there is any reaction or rhetoric from Eurozone members following the UK’s triggering of Article 50.
Thursday sees the release of the Spanish and German inflation numbers. On Friday, German retail sales and unemployment data will be announced and the Eurozone will release the latest inflation data. The inflation figures are key. Stable, higher inflation would be perceived as an indicator that a rate hike may be on the cards.