The euro rallied against other most-traded currencies today after the German business climate improved unexpectedly this month. The rally was nowhere near big enough to erase Friday’s big losses, though.
The Ifo Business Climate Index for Germany rose from 98.7 to 99.6 in March, seasonally adjusted. Analysts had expected the index to stay unchanged. That was the first increase following six consecutive months of decline.
Looking deeper into the report, the business climate in the manufacturing sector continued to worsen. The climate in all other sectors (services, construction, and trade) was improving.
The positive data relieved a bit recession fears caused by Friday’s bad reports. The next important indicator will be German inflation data due for release on Thursday. There will be plenty of other reports in the eurozone this week, but they will likely be of limited importance.
EUR/USD rose from 1.1293 to 1.1318 as of 10:27 GMT today. EUR/GBP climbed from 0.8549 to 0.8596. EUR/JPY gained from 124.25 to 124.73 after falling to 123.87 earlier.
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