Euro dropped to a 3.5-year low against sterling yesterday, after a week of poor economic performance for the eurozone, particularly German industrial production. December saw the biggest drop in German industrial production since the global financial crisis a decade ago. German GDP figures this morning also showed a small drop year-on-year. As well as this, the European Commission’s forecasts remained unchanged, saying the European economy is on a path of ‘subdued growth’.
The Commission argued that the Eurozone and wider European Economic Area is ‘well placed to navigate the challenging external environment’, but noted that it is a ‘highly fragile equilibrium, which could easily be derailed by unforeseen events’.
German monthly inflation figures, released yesterday, didn’t meet up to expectations, showing an unexpected decline. Later today, we will see Eurozone GDP, employment and trade balance figures.
