Eurozone Economic Outlook Fairly Unchanged
- Consumer Confidence continued to decline, coming in at -8.8, as expected.
- Overall Economic Sentiment however, rose (114) above figure produced for December and January
- Industrial Sentiment dipped slightly when compared to the forecast but rose above last month’s figure (14).
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In the UK, the Eurozone’s neighbour, we saw the largest month on month drop in the Gfk consumer confidence survey from -19 to -26 since the start of the pandemic. Similar increases in energy and fuel costs along with increases in health care contributions have raised concern for the UK consumer as rate hikes are set to pressurise disposable income.
The data is unlikely to have a material effect on Euro assets in ordinary conditions and are set to have even less importance due to the ongoing invasion of Ukraine and subsequent waves of sanctions imposed by the west on Russia with retaliatory sanctions reported to be on the way.
No significant reaction in EUR/USD as expected, however, the pair is susceptible to lower moves should the flight to US dollars resume today. Additional risks appear in the form of harsher sanctions against Russia with some urging banning Russia from the SWIFT international payment system.
EUR/USD 5 Min Chart
Source: IG, prepared by Richard Snow
— Written by Richard Snow for DailyFX.com
Contact and follow Richard on Twitter: @RichardSnowFX
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