Wednesday, the euro recovered from multi-day lows against its most major counterparts despite a report showed that Germany's business confidence fell to a record low in March. The euro recovered from a 13-day low against the franc, 6-day low against the dollar and a 2-day low against the yen. Meanwhile, the euro remained higher against the pound today.
A monthly survey from the Munich-based Ifo Institute for Economic Research showed that German business confidence deteriorated to 82.1 in March from 82.6 in February. This was the lowest reading since the survey began in 1991. The expected level for March was 82.2.
The index measuring current situation worsened to 82.7 in March from 84.3 last month. However, the index stood above the expected reading of 82.5. On the other hand, the expectations index rose to 81.6 from 80.9 last month. Economists were expecting a reading of 81.5 for March.
In addition, Italy's economic think tank ISAE said consumer confidence in the economy declined in March after rising in past two months. The consumer confidence index fell to 99.8 in March from 104 recorded in February. Economists had forecast the reading to decline to 103.
The euro, which closed yesterday's trading at 0.9176 against the pound strengthened to 0.9230 during early deals on Wednesday. The near term resistance level for the euro-pound pair is seen at 0.925.
The euro advanced after hitting a 6-day low of 1.3420 against the dollar and 130.80 against the yen at 4:35 am ET Wednesday. Currently, the euro is worth 131.70 against the yen and 1.3485 against the dollar, compared to Tuesday's close of 131.83 and 1.3468, respectively. If the euro climbs further, it may likely target 1.358 against the dollar and 132.6 against the yen.
The Ministry of Finance said that Japan saw a merchandise trade balance of 82.4 billion yen in February, marking the first surplus in five months. The February figure came in better than expectations for a 13.7 billion yen deficit following the revised record 956.9 billion yen shortfall in January. The original figure came in at -952.6 billion yen.
Meanwhile, the Bank of Japan Deputy Governor Hirohide Yamaguchi said today that Japan's economic and financial conditions will likely continue to be severe. Addressing business leaders in Otaru, Yamaguchi said at this point, the central bank is giving higher priority for securing market stability and facilitating corporate financing, which are the second and third main areas of the BoJ's conduct of monetary policy.
The euro fell to a 13-day low of 1.5189 against the Swiss franc by about 4:10 am ET Wednesday. Thereafter, the euro bounced back and the pair is now trading at 1.5235 with 1.529 seen as the next target level. At Tuesday's close, the euro-franc pair was quoted at 1.5245.
Traders now look forward to the New York session, in which the US Commerce Department is set to release its durable goods orders report at 8:30 am ET. Economists look forward to a 2% decline in the durable goods orders for February.
At 10:00 am ET, the Commerce Department is due to release its new home sales report for February. The consensus estimate calls for a decline in new homes sales to 300,000.
The Energy Information Administration is scheduled to release its weekly petroleum inventory report at 10:30 am ET.
Cleveland Federal Reserve Bank Sandra Pianalto is due to deliver a speech on forces for economic recovery Regional Growth Partnership luncheon in Maumee, Ohio at 12:20 pm ET. Meanwhile, San Francisco Federal Reserve Bank Janet Yellen is scheduled to deliver a speech to the Forecasters Club of New York on the U.S. economic situation and policy responses in New York at 12:30 pm ET.
For comments and feedback: contact email@example.com