Economic Sentiment and GDP Figures Give the EUR a Boost

It’s a relatively busy day on the Eurozone economic calendar today. Eurozone 4^th quarter GDP numbers and Economic Sentiment figures for Germany and the Eurozone were in focus.

Eurozone GDP Revised Upwards

According to 2^nd estimates, the Eurozone economy contracted by 0.6% in the 4^th quarter. This was an upward revision from a 1^st estimate 0.7% contraction.

Year-on-year, the economy contracted by 5.0%, which was also an upward revision from a 1^st estimate 5.1% contraction.

According to Eurostat,

• The number of employed persons increased by 0.3% in 4^th quarter, compared with the previous quarter.
• In the 3^rd quarter of 2020, employment had increased by 1.0%.
• Year-on-year, however, employment was down by 2.0%.

Economic Sentiment Surprises

Germany’s ZEW Economic Sentiment Index rose from 61.8 to 71.2 for February. Economists had forecast a fall to 59.6.

The upside came in spite of sentiment towards current conditions fell deeper into the red. For February, the ZEW Current Conditions Index fell from -66.4 to -67.2. Economists had forecast a decline to -67.0.

For the Eurozone, the Economic Sentiment Index jumped from 58.3 to 69.6.

Market Impact

Following some disappointing stats last week, the EUR found some immediate support in response to the stats.

In response to this morning’s economic data, the EUR rose from $1.21527 to a post release high of $1.21569 before easing back. Despite the better than expect numbers, the EUR failed to revisit a current day high $1.21573 struck ahead of the data release.

At the time of writing, the EUR was up by 0.22% to $1.21547.

For the European majors, the DAX30 recovered from negative territory, with the EuroStoxx600 heading back towards its pre-data release high.

At the time of writing, the DAX30 and the EuroStoxx600 were up by 0.10% and 0.20% respectively.