Yesterday saw a continuation of the mixed data theme from the Eurozone, with the key German IFO Business Climate index falling not only below expectations but also last month’s figure. German business expectations also fell below expectations and declined, but the German current assessment was as expected. The relatively rocky road that Europe’s biggest economy seems to be walking was reflected in the euro’s (EUR) performance: the single currency fell against the pound (GBP), and after a rally fell towards the end of the day against the dollar (USD).
Today’s main releases are the GFK German consumer climate and Spanish unemployment data. Though not expected to have much of an effect on the market, any more negative news from Germany could affect the single currency, as confidence within its largest economy begins to falter.