The Euro is advancing versus the US Dollar on Thursday snapping a three-day losing streak. The Euro US Dollar exchange rate settled -0.4% lower versus the US Dollar on Wednesday at US$1.0795.
At 08:15 UTC, EUR/USD is trading +0.1% at US$1.0805 as German industrial production plunges and ahead of US initial jobless claims figures.
German Industrial Production Dives -9.2%
The Euro has picked up off session lows and is attempting to claw higher despite more dire data from the bloc. Germany, the largest economy in Europe, saw industrial production drop like a stone in March. Industrial output declined -9.2% month on month, down from a 0.3% increase in February. It almost goes without saying that this was the sharpest monthly drop on record. On an annual basis German industrial production was down by -12% as the lockdown measures, not just in Germany but also abroad, hits the German economy hard.
The data comes following a barge of record-breaking weak figures from the eurozone in the previous session. Service sector activity, retail sales and factory orders all plunged, highlighting the devastating impact of the coronavirus crisis on the economy.
However, countries across Europe are starting to gradually ease lockdown measures and reopen economies, which is offering some optimism, even as the horrifying data comes in. Germany declared an end to the first phase of the pandemic on Wednesday. However, Chancellor Angela Merkel warned that there was still a long way to go in the battle against the virus.
There is no more high impacting Eurozone data due today. Investors will keep monitoring lockdown exit strategies and announcements.
3 Million Initial Jobless Claims Expected
The US Dollar is slipping on Thursday as investors look ahead to the release of US initial claims. Analysts are expecting a further 3 million Americans t sign up for employment benefits in the week of 1st May. This would take the total to 33 million Americans singing up for initial jobless claims in just 7 weeks. Whilst lockdown restrictions are being lifted in several states, layoff data has not yet improved. A weak reading could boost demand for the safe haven US Dollar.
The data comes following yesterday’s ADP Private payroll data which showed that 20.2 million jobs were lost in April amid the covid-19 crisis. To put the figure into context, it was the worst on record and double the number of jobs lost in February 2009 in the Financial crisis as millions of business shutdown for the coronavirus lockdown.