The all-important German IFO Business Climate remained unchanged at 114.2. Early expectations stood on a slide to 113.7 points. EUR/USD is reacting with a rise. Also the other figures released by IFO came out better than expected. Update.
EUR/USD jumped from 1.4060 to 1.4088, around the high levels seen yesterday. The move continues.
The IFO Think Tank is highly regarded in Germany and this survey is of high importance, due to its wide scope: around 7000 businesses are surveyed. The institute changed the formula for the calculation from this month.
Early expectations for the headline business climate were for a score of 113.7 points, and this came out better. Future expectations stood on 107 points, and the actual number was 107.4 points. The final number – the current assessment, for May, came out at 121.4 points, also higher than 120.7 points that was expected.
Prior to the publication, EUR/USD traded at around 1.4060. Yesterday, the pair plunged and reached 1.3969, above support at 1.3950. But it then made a gradual recovery, eventually overcoming the 1.4030 line, and settling more safely above it towards this important release.
Significant resistance is at 1.4160. Support is at 1.3950. For more analysis and events, see the EUR/USD forecast.
News concerning the debt crisis continued to flow from Europe: Belgium followed Italy and also received a downgrade warning. Greece put up a an ambitious privatization plan, in order to pay its debt, but it didn’t fully convince the markets. Earlier today, German growth was confirmed at 1.5% in Q1.
