The euro recovered from earlier losses to trade around $1.13, nearing a two-week high. Investors are weighing recent economic data releases against the backdrop of the ECB’s monetary policy considerations and dollar weakness driven by US debt concerns.
- The Euro traded around the $1.13 mark, near a two-week high, after recovering from earlier losses.
- Germany’s Ifo Business Climate Index rose to 87.5 in May, the highest since June 2024 and slightly above expectations.
- Eurozone’s private sector experienced a sharper-than-expected contraction, the steepest in six months, with a decline in services activity.
- Output fell in both Germany and France.
- US debt burden concerns, following the passage of President Trump’s tax bill, pressured the dollar.
The euro’s resilience is being tested by conflicting economic indicators. While German business sentiment shows improvement, a broader contraction within the Eurozone’s private sector raises concerns. The currency is also being influenced by external factors, such as the weakness of the dollar due to increasing US debt. These mixed signals suggest a period of uncertainty for the euro, where positive momentum could be offset by negative economic developments.