Yesterday saw a quiet start to the week within the Eurozone. Italian consumer price data and French bond sales were the only important data releases of the day.
Italy’s price information was released as forecast but the French election seems to have begun to have an effect on the country’s debt markets, with yields all increasing (although they remain in negative territory for short-term bonds). France’s bond sales were accompanied by the news that Italy, Spain and Portugal (part of the group of ‘troubled’ Eurozone economies) had seen demand for their bonds dip to a 12-week low.
The euro opened the week higher against the pound, mainly driven by May’s Brexit comments, and strengthened significantly. It was a totally different picture against the dollar, against which the single currency opened lower and weakened as the day went on because investors were moving money out of European currencies more generally. This morning the euro has enjoyed an early bounce.
Today sees the Centre for European Economic Research in Mannheim (ZEW) release Economic Sentiment and Current Conditions for Germany as well as Economic Sentiment for the bloc as a whole. These figures are all expected to show growth – so any deviation from the predicated figures could cause movement within euro markets.
The data from the ZEW will be joined by the Italian trade balance and Spanish bond sales, but these releases will attract less investor attention.