EUR: Guided by the weaker confidence in Eurozone export markets - AmpGFX
According to Greg Gibbs, Analyst at Amplifying Global FX Capital, the EUR/USD appears to be developing a clearer downtrend that is consistent with the Eurozone’s persistently weaker economic growth data since Q1.
Key Quotes
“At times it had seemed to ignore weaker growth data supported by expectations that it might be short-lived, and upbeat assessments by the ECB reaffirming their intention to end QE this year. However, the market may be losing confidence that the Eurozone will rebound, contributing to a clearer down-trend in the EUR.”
“The Eurozone is a significantly more export-driven economy than the USA, and it appears that its weaker industrial performance through the last six-months may reflect weaker demand growth from China and much of the rest of the world outside of the USA.”
“As such, weaker confidence in the Chinese economy, in part driven by US trade policy, may now be spilling over to weakness in the EUR, and in turn, broadening strength in the USD.”