Pure FX Blog

7 December 2017

US Dollar Nears 2-Week High Versus Euro, as German Industry Slows

The US dollar to euro interbank exchange rate has reached 0.8481 today, close to its highest since November 22nd, as German industrial production fell -1.4% in October. Image credit: William Lepretre.

The US dollar to euro interbank exchange rate has reached 0.8481 today, close to its highest since November 22nd, as German industrial production fell -1.4% in October. Image credit: William Lepretre.

by Peter Lavelle

Welcome to Pure FX’s latest update of the US dollar to euro interbank exchange rate.

The greenback strengthens versus the common currency! The US dollar to euro interbank exchange rate has neared its highest in 2 weeks today, or since November 22nd, at 0.8481.

The US dollar has risen against the euro, because German industrial production unexpectedly fell -1.4% in October, said Germany’s Economy Ministry today, below forecasts for a +1.0% rise.

This has dragged down the euro, because this was the sharpest fall in German industrial production in 2017 to date, and follows September’s unexpected drop of -0.9%.

According to Claus Vistesen at Pantheon Macroeconomics, this was “very disappointing” and “inexplicably poor” German industrial production data, thereby weighing on the euro.

In particular, manufacturing production in Germany fell -2.0% in October, as factories produced fewer investment and consumer goods, so weakening the common currency!

US dollar rises, as US job creation remains strong

What’s more, the US dollar to euro interbank exchange rate has also neared this 2-week high, because the USA’s job market remains fighting fit, according to a new report yesterday.

The USA created +190,000 new jobs in November, said economics firm Automatic Data Processing (ADP) on Wednesday, above forecasts for +185,000 new posts, and thus lifting the US dollar.

This has lifted the greenback, first because this data tells us that America’s “job market is red hot, with broad-based job gains across industries,” says Moody Analytics’ Mark Zandi.

This has also strengthened the buck, because ADP’s upbeat jobs data bodes well for the US Labor Department’s closely-watched job creation survey, the Non-Farm Payroll (NFP), due tomorrow.

With all this in mind, the US dollar has neared this 2-week high versus the euro today!

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Please bear in mind, this article is Pure FX’s opinion only and does not constitute advice. Moreover, the exchange rates referred to in this article are the interbank rates, which are the rates at which banks and financial institutions buy and sell currency to each other. Therefore these exchange rates cannot be accessed by individuals or SMEs, and are not the same rates that Pure FX can offer. To get a free exchange rate quote, call us on +44 (0) 1494 671800, or email peter.lavelle@purefx.co.uk.

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