News Column

Euro Rises Despite Weak German Ifo Business Sentiment Index

June 24, 2014

CANBERA (Alliance News) - The European currency rose against most major currencies in the European session on Tuesday despite the release of data showing decline in German Ifo business confidence in June.

German business confidence deteriorated more than expected in June, reports said citing Ifo survey.

Business sentiment fell to 109.7 in June from 110.4 in May. Economists had forecast the reading to drop marginally to 110.3.

Current conditions remained unchanged at 114.8 in June, while it was forecast to rise to 115.

The expectations index dropped to 104.8 in June from 106.2 a month ago. The reading was also below the expected level of 106.

The euro rose to a 5-day high of 0.8023 against the pound and a 4-day high of 1.3624 against the US dollar, from early lows of 0.7982 and 1.3591, respectively. At yesterday's close, the euro was trading at 0.7987 against the pound and 1.3603 against the greenback. If the euro extends its gain, it may find the resistance around 0.80 against the pound and 1.37 against the greenback.

Against the yen and the NZ dollar, the euro rose to a 2-week high of 138.91 and a 1-week high of 1.5648 from early lows of 138.44 and 1.5641, respectively. The euro was quoted at 138.63 against the yen and 1.5603 against the kiwi at yesterday's close. The next possible upside target of the euro is seen at 139.50 against the yen and 1.58 against the kiwi.

Moving away from early lows of 1.4415 against the Australian dollar and 1.4571 against the Canadian dollar, the euro strengthened to 1.4494 and 1.4604, respectively. The euro closed yesterday's deals at 1.4433 against the aussie and 1.4595 against the loonie. The euro may test resistance near 1.45 against the aussie and 1.48 against the loonie .

Looking ahead, US S&P/Case-Shiller's home price index for April, new home sales for May and consumer confidence index for June are due to be released in the New York session.

European Central Bank official Benoit Coeure is due to speak in Frankfurt at 9:55 am ET.

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Source: Alliance News

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