Economic data from Germany and Eurozone fail to support the euro


This morning was another busy start to the day on the eurozone economic calendar.

German industrial production and euro area retail sales figures were in the spotlight this morning.

The French non-farm payroll and German construction figures were also out but had a moderate impact on the euro.

German economy

In September, industrial production in Germany fell 1.1% against an expected increase of 1.0%. Production fell 3.5% in August.

According to Destatis,

  • Production in industry excl. energy and construction was down 1.5%.
  • Within industry, the production of capital goods fell by 2.8% and that of intermediate goods by 1.1%.
  • Manufacturing of motor vehicles, trailers and semi-trailers rose 2.1%, partially reversing an 18.9% drop from August.
  • The production of consumer goods edged up 0.2%.
  • Excluding industry, energy production is up 1.0% and construction production is up 1.1%.

Eurozone retail sales

In September, retail sales fell 0.3% from an expected increase of 0.3%. Retail sales rose 1.0% in August.

According to Eurostat,

  • Sales of non-food products fell 1.5%, while sales of food, beverages and tobacco increased 0.7%.
  • Automotive fuel sales increased 1.1%.
  • By Member State, Estonia (+ 7.1%), Slovakia (+ 2.9%) and Luxembourg (+ 2.3%) recorded the largest increases in sales.
  • Germany (-2.5%), however, recorded the largest drop in September.
  • Retail sales increased 2.5% compared to September 2020.

Other statistics

The French non-agricultural payroll increased by 0.5% in the 3rd quarter, with the German HIS Markit Construction PMI dropping from 47.1 to 47.7.

The statistics had a moderate impact on the euro, however, with German industrial production and euro area retail sales being key.

Market impact

In response to today’s numbers, the EUR hit a post-stat and current high of $ 1.15631 before falling back to a post-stat and current low of $ 1.15341.

At the time of this writing, the Euro was down 0.15% to $ 1.15736.

Following

The US non-farm payroll for October is due for release later today. With the Fed’s green light and the reduction in the asset purchase program, a surge in hiring could fuel expectations of a shorter-term rate hike.

The numbers should be impressive, however.


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