EUR/USD: Germany’s Ifo business climate index dropped to a three-year low level in January


EURUSD Movement

For the 24 hours to 23:00 GMT, the EUR rose 0.96% against the USD and closed at 1.1410 on Friday.

On the data front, Germany’s Ifo business climate index declined to a level of 99.1 in January, falling to its lowest level since February 2016 and more than market consensus of a fall to 100.7. In the prior month, the index had recorded a level of 101.0. Moreover, the nation’s Ifo business expectations index slid to a level of 94.2 in January, declining for the fifth straight month amid mounting fears over a no-deal Brexit. The index had registered a level of 97.3 in the prior month, while market participants had expected for a fall to a level of 97.1. Also, the Ifo current assessment index dropped to a low level of 104.3 in January, marking its lowest level since May 2017 and less than market anticipation for a decrease to a level of 104.2. In the prior month, the index had recorded a reading of 104.7.

In the Asian session, at GMT0400, the pair is trading at 1.1420, with the EUR trading 0.09% higher against the USD from Friday’s close.

The pair is expected to find support at 1.1348, and a fall through could take it to the next support level of 1.1276. The pair is expected to find its first resistance at 1.1459, and a rise through could take it to the next resistance level of 1.1498.

Moving ahead, traders would closely monitor the European Central Bank President, Mario Draghi’s speech followed by the Euro-zone’s M3 money supply for December, slated to release in a few hours. Later in the day, the US Chicago Fed national activity index for December and Dallas Fed manufacturing activity index for January, will garner significant amount of investor attention.

The currency pair is trading above its 20 Hr and 50 Hr moving averages.

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