Market News
May 8, 2013 @ 8:02 pm

Euro advances to upper $1.31 on strong German data

The euro advanced higher in the North American trading session on Wednesday to peak at $1.3194 after being boosted by German industrial production numbers which surpassed expectations.

The broadly stronger euro also helped lift EURJPY to 130.42, marking a 0.4 percent gain.

EURGBP traded up 0.2 percent at 0.8466.

A report showed that Germany’s industrial output, which includes manufacturing, mining, electricity and gas, jumped 1.2 percent in March, recording the largest advance in a year and confounding expectations for a 0.1 percent drop.

The German IP data come a day after factory orders came in better than expected as well. Germany is Europe’s largest economy and is perceived as the “engine of growth”.

So the strong data is important and it is hoped that it will post better-than-expected growth rates for the first quarter.

During the last quarter of last year, the German economy contracted 0.5 percent.

The strong data temporarily eased recent concerns that the European Central Bank may cut interest rates again in the near future.

The ECB cut the benchmark rate by 25 basis points last week to 0.5 percent.

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