Euro weekly forecast

The Euro began the week struggling for support after the release of Germany's latest Ifo business climate survey.

The index for June reported an unexpected decline in business morale, which ultimately dampened EUR sentiment at the start of the week. As mid-week trading progressed, the Euro faced renewed weakness due to an unforeseen drop in German consumer confidence.

On Thursday, the Euro managed to overcome Wednesday's decline in Eurozone economic sentiment, supported by indications of increasing consumer inflation expectations. However, the common currency ended the week on a weaker note following the release of the latest German jobs data.

German unemployment unexpectedly increased for the first time in six months, rising to 6% instead of remaining at the expected 5.9%. As the survey reached its highest level since May 2021, the Euro faced difficulty in gaining support by the end of the week.

The Euro struggled to gain much traction on Friday, given the upcoming election in France over the weekend.

Looking ahead this week for the Euro, on Monday, German inflation is projected to decrease from 2.4% to 2.3%. If the data meets expectations, this is likely to increase bets on European Central Bank interest rate cuts, potentially weakening the single currency as a result.

On Tuesday, both core and headline Eurozone inflation are expected to moderate, which is likely to maintain downward pressure on the Euro. Also on Tuesday, the Eurozone's unemployment rate is expected to stay at record lows, which could continue to put downward pressure on the EUR.

On Thursday, Germany's upcoming factory orders are anticipated to reflect a rebound in the latest reading, potentially offering modest support to the common currency.

Lastly, on Friday, an unforeseen rise in both German industrial production and Eurozone retail sales is anticipated to strengthen the Euro, potentially leading to a stronger finish to the week compared to its counterparts.

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