Forex »

EURUSD Negatively Impacted By Falling German Inflation Numbers

James Boston
Share on StockTwits
Published on
www.finances.com
EURUSD Negatively Impacted By Falling German Inflation Numbers

German price growth activity has turned negative according to the preliminary October inflation figures just published. The Consumer Price Index (CPI) has registered -0.3% when measured month on month, this represents a further fall on the September final reading of 0.0% and also came in well below market analyst’s estimates for a minor deflationary figure of -0.1%. Year on year the CPI has managed to hold onto it’s 0.8% growth reading, this provided some negative surprise as a figure of 0.9% was expected this month.

The Harmonized Index of Consumer Prices (HICP) is closely mirroring the CPI numbers. Month on month the German preliminary HICP now stands at -0.3% for the month of October, the September measurement was 0.0% and the expectation today was for a drop to just -0.1%. Year on year the HICP has actually fallen a point, the latest number of 0.7% follows September’s 0.8% reading and market consensus estimates of a rise to 0.9% were clearly missed.

The poor inflation numbers have not really come as a surprise given the softness evident in the German economy over the past few months. Today’s employment figures have however provided a slight positive surprise element to the markets. The headline Unemployment rate has not changed, the latest reading, for October, is still at the 6.7% level. The Unemployment Change figure however has posted some improvement, this month’s data shows that there are 22k less people claiming to be unemployed than there was in September, this represents a turnaround from last month’s measurement which revealed an additional 9k people on the unemployment register, the expectation today was that a further 5k would be added. Overall the numbers unemployed in Germany are 2.9M, this has not been significantly impacted by the Unemployment Change number, but when the seasonal adjustment is removed from the figure the number stands closer to 2.7M.

Share on StockTwits