Euro Falls on Softer German Business Confidence

The euro fell against the U.S. dollar on Wednesday after data showing a surprise deterioration in business morale in Germany stoked fears of slowing global growth and weighed on a gauge of world equity markets.

The decline in the Munich-based Ifo economic institute’s business climate index bucked expectations for a small improvement and sent U.S. Treasury yields reeling as investors piled into safe-haven bonds.



Reports of a sharp slowdown in Australian inflation also lifted bond prices, while Premier Li Keqiang in China said authorities should not underestimate the difficulties in the Chinese economy, adding to concerns about global growth.

Signals that China has put broader stimulus on hold curbed demand for European equities and overshadowed strong earnings from the likes of Credit Suisse and SAP, which led Germany’s DAX index to rise 0.45%.

via Reuters

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza