Euro trading sideways after mixed data

The Euro started the week hesitantly against its counterparts after receiving mixed releases from the Eurozone's largest economy.

An unexpected drop in German factory orders initially weakened the common currency, with orders declining by 0.4% in March instead of the predicted 0.5% increase.

However, helping to offset some of the losses for EUR were Germany's latest export figures, which showed a 0.9% increase in the export-heavy industry.

Moreover, better-than-expected retail sales across the Eurozone provided additional support for the Euro on Tuesday. Retail sales surged by 0.8% in March, exceeding market forecasts of 0.6% and rebounding from February's -0.3% reading.

Entering Wednesday, EUR exchange rates were lifted following the release of better-than-expected German industrial production data.

Germany’s latest industrial production figures reported a 0.4% contraction in March, down from February’s 1.7% reading, but surpassed forecasts of a 0.6% decline.

Although this marked the first contraction in the sector within a three-month period, industrial production slowed less than expected in the Eurozone’s largest economy, ultimately lending support to EUR.

At the end of the week, minimal Eurozone data releases led to the single currency ending the week trading without a clear direction.

Looking ahead for the Euro, on Tuesday, if German inflation is predicted to slightly increase, this could potentially boost EUR exchange rates, setting a positive tone for the week.

Also scheduled for release on Tuesday is Germany’s latest ZEW economic sentiment index. With expectations of a rise in the data, this could further strengthen the Euro at the beginning of this week’s trading session.

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