- Economic sentiment continued to deteriorate in the euro area and in Germany.
- EUR/USD stays under bearish pressure, declines toward 1.0100.
The Economic Sentiment Index component of the ZEW Survey for Germany declined to -55.3 in August from -53.8 in July. This reading came in worse than the market expectation of -53.8. Furthermore, the Current Situation Index declined to -47.6 from -45.8. Finally, the Economic Sentiment Index for the eurozone slumped to -54.9 from -51.5, missing analysts' estimate of -42.5 by a wide margin.
Key takeaways
"Financial market experts expect a further decline in the already weak economic growth in Germany."
"Still high inflation rates and the expected additional costs for heating and energy lead to a decrease in profit expectations for the private consumption sector."
"In contrast, the expectations for the financial sector are improving due to the supposed further increase in short-term interest rates."
Market reaction
The shared currency stays on the backfoot after this report and EUR/USD was last seen losing 0.3% on the day at 1.0128.
