Worse than expected data from Germany: the XEW economic sentiment drops fo 1.9 points and current conditions plunge to 55.2. Comments accompanying the release point to the VW crisis indeed.
EUR/USD extends its slide from the highs. The pair basically returns to the drawing board under 1.1370.
The German ZEW Economic Sentiment figure was expected to be halved from 12.1 points in September to 6 in October, but a negative figure due to the Volkswagen crisis couldn’t be ruled out. The Current Conditions component carried expectations for a slide from 67.5 to 64.7 points.
EUR/USD traded around 1.1383 before the release, down from the highs it reached out to earlier. It seems that reaching the critical resistance level of 1.1460 is a tough task.
The factors weighing on the sentiment of businesses in Germany are China, with less demand for German goods and VW. The car maker is critical to the German economy.
More: EUR/USD: Limited Upside Risk; Sell Rallies – Credit Agricole
