German data shows more signs of improvements

Yesterday we had the latest updates on the strength of the power house of Europe, Germany. They released their Import and Export figures which showed improvements with their steepest monthly climb in four and a half years which pushed up the overall industrial production for the European Union.

This improvement went some way to help strengthen the Euro, making it more expensive to buy this week.

European unemployment update

On Monday we also saw confirmation of the overall unemployment levels across the single currency. This remained unchanged at the seven year low of 9.8%, an estimated 20.4 million people are without work. Greece continues to have the highest level of unemployment at 23.1% with Spain second at 19.2%. Germany has the lowest at 4.1%.

ECB meeting minutes forecast and impact

Unemployment continues to be a talking point and challenge for the European Central Bank (ECB) due to the large variance between member states. This will remain a talking point at their on-going meetings, with meeting minutes from the latest (December) to be published on Thursday of this week.

This is expected to show that some members have begun pushing for a withdrawal of the QE program that has been running for over 12 months. This is likely to be in response to the falling jobless figures and rising inflation we are experiencing across the EU.

The topic of QE reduction will remain constant but any change in it’s likelihood will affect the value of the Euro. In this instance I personally expect the release to have a negative impact on the single currency and could make Thursday one of the better days to buy the Euro this week.

When are the elections in Europe?

National elections are taking place in France in May and in Germany in the Autumn and will drive the Euro’s values. Recent events have taught many that there is the possibility of protest votes and surprises.

Ladbrokes odds are currently pricing a 29% probability of Marine Le Pen, of the Front National, winning the second round of the French presidential election. They are also offering a 42% chance of someone other than Angela Merkel becoming the German Chancellor this year.

What is worth noting is that both of these are better odds than those offered on Donald Trump becoming the US President only a year ago.

These are topics anyone with Euros to buy in the coming months should be well aware of to calculate their risk against reward, i.e. is the risk of waiting out weighted by the guarantee of buying early.

For more information on how to calculate this please get in contact with your currency broker or email me directly at hse@currencies.co.uk.

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