EUR/USD Muted Following Mixed ZEW Survey, Euro Risks Remains Lower

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EUR/USD Analysis and News

• EUR/USD Muted on Mixed ZEW Survey
• Bias Remains to Fade Euro Rallies

The Euro and DAX saw a subdued reaction following a mixed ZEW report. Economic sentiment fell to 29.9 from 31.7 a month prior, however, printed above expectations, while current conditions fell 7.4, missing estimates of 5.0. German Investor confidence weakened in December amid a fourth Covid wave, while persistent supply bottlenecks in manufacturing added to the layer of uncertainty surrounding Germany’s growth outlook.

DailyFX Economic Calendar

What’s more, the ZEW President stated that the decline in economic expectations signals that optimism over a stronger growth outlook are beginning to fade. This in turn, has factored into the ECB’s thinking, given source reports suggesting that the central bank may wait until next year before announcing any notable policy changes.

EUR: Marginal softness for the Euro, and as noted last week, the bias remains to fade rallies in the Euro. Near-term support for the pair is situated at 1.1230-35 and below 1.1370, risks remain to the downside.

EUR/USD Chart: Hourly Time Frame

Source: Refinitiv

 

By Justin McQueen, Strategist, 7th December 2021. DailyFX