- German GDP Data Slumps, Sending Euro Spiralling
- Eurozone Fails to Come to the Euro’s Rescue
- GBP Looks to Gain on Public Spending Projects as Euro Suffers Offering a Tempting Exchange Rate
Today marked the release of the German GDP values for Q4 in 2019. Following a recent stagnation in data releases, the Eurozone was hoping that the German GDP would not decrease and send the Euro lower. However, at 07:00 GMT Friday morning the results were in which showed a 0.2% drop in the GDP figure from 0.2% to 0%. The German economic slowdown has dragged on the Eurozone’s economic performance of late. Furthermore, the Eurozone’s own GDP figure was released at 10:00 GMT which saw the YoY figure for Q4 2019 drop from 1.2% to 0.9%. Another disappointing blow for the Euro which sees other currencies like the GBP edge over it. The GBP looks to be on a positive streak after the UK government announced its plans to increase public spending in an attempt to raise the fiscal stimulus of the British economy.
German GDP Data Slumps, Sending Euro Spiralling
Being the Eurozone’s largest economy, the performance of the German market is crucial for overall success within the Eurozone. However, with a very poor couple of months, the German economy has shown signs of an economic slow-down. The GDP figure for Q4 in 2019 today showed that growth had slumped from 0.2% to 0%. The stagnation in the growth has seen the Euro fall out of favour with investors as the Euro dwindles. The export sector appeared to be the biggest driver of the weakness seen by the economy although the domestic side of the economy showed signs of softening too.
Eurozone Fails to Come to the Euro’s Rescue
Today also saw the Eurozone’s GDP figure released, unsurprisingly, the GDP growth dropped from 1.2% to 0.9% from the previous year’s Q4 showing. This supports the notion of a Eurozone economic slow-down as it is not only Germany that appears to be struggling but the whole of the Eurozone. The Eurozone took some positives from today’s release like Trade Balance and Employment Change figures, but the data was low on the impact scale for the currency so did little to support the Euro.
GBP Looks to Gain on Public Spending Projects as Euro Suffers Offering a Tempting Exchange Rate
With the Euro sinking, the opportunity for Euro buyers to cash in has presented itself. The GBP/EUR has moved above 1.20, which offers those buyers the best rate for 6 months against the Euro. The UK recently saw a cabinet reshuffle in which the Chancellor of the Exchequer role was given to Rishi Sunak, taking over from Sajid Javid. With the new Chancellor anointed, the government spending has been tipped to be increased. Recent UK plans for a HS2 high-speed rail was unveiled this week as one of the first instalments to boost fiscal stimulus for the British economy in a push to build support from investors.
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