The euro climbed today, erasing yesterday’s decline versus the US dollar, as eurozone macroeconomic indicators were not that bad, while short-covering after the previous huge drop also helped to propel the currency higher.
The ZEW Indicator of Economic Sentiment for Germany fell from 48.5 in March to 36.3 in April, more than analysts have predicted. The data was not good, strictly speaking, but the report pointed out that “the indicator currently hovers at its third highest mark within the last 24 months”. Eurozone annual inflation was at 1.7 percent in March, little changed from the February’s 1.8 percent.
Optimism is returning to the Forex market and is helping the euro. Traders thought that perhaps yesterday’s huge sell-off was overdone and such thinking reversed the losses of stocks, commodities and higher-yielding currencies.
EUR/USD jumped from 1.3032 to 1.3176 as of 22:58 GMT today, while its daily high of 1.3200 was highest since February 25. EUR/JPY edged up from 126.05 to 128.63 after falling to 124.94. EUR/GBP went higher from 0.8526 to 0.8576 and its daily maximum of 0.8598 was strongest since March 20.
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