German ZEW Economic Sentiment Index slumps to 63.3 in July, EUR/USD tests lows

German ZEW Economic Sentiment arrived at 63.3 in July, down from 79.8 previous.
The ZEW Current Situation for Germany came in at 21.9 in July vs. -9.1 in June.
EUR/USD remains pressured below 1.1850 on mixed German and Eurozone data.

Dhwani Mehta FXStreet

The German ZEW headline numbers for July showed that the Economic Sentiment Index worsened more than expected to 63.3 from 79.8 previous while missing estimates of 75.2.

Meanwhile, the Current Conditions sub-index recovered firmly to 21.9 in July as against -9.1 recorded in the previous month and 5.0 expectations.

Separately, the Eurozone ZEW Economic Sentiment for July fell to 61.2 for the current month as compared to 81.3 previous and 84.4 consensus forecast.

ZEW President Achim Wambach said, "The economic development continues to normalize. The situation indicator for Germany has clearly overcome the coronavirus-related decline. Although the ZEW indicator of economic sentiment has once again fallen significantly, it is still at a very high level.”

“Financial market experts, therefore, expect the overall economic situation to be extraordinarily positive in the coming six months,” Wambach added.

Also, on the docket was the bloc’s Retail Sales, which came in at 4.6% MoM and 9% YoY vs. 4.4% and 8.2% expected respectively.

FX market reaction

The euro showed little to no reaction to the mixed data dump, as EUR/USD flirted with daily lows of 1.1842 amidst resurgent US dollar demand. The spot hit a multi-day high of 1.1.1875 ahead of the European open.

Author

Dhwani Mehta

FXStreet

Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.

EUR/USD seems fragile below 1.1700 as Middle East war boosts energy prices

The EUR/USD pair trades flat at around 1.1680 during the Asian trading session on Tuesday, but broadly seems vulnerable, being close to its five-week low. The major currency pair is under pressure as surging oil prices due to the United States-Israel war with Iran have increased the risks of higher inflation for the Old Continent.

GBP/USD hovers around 1.3400 with bearish pressure intact

GBP/USD edges higher after three days of losses, trading around 1.3400 during the Asian hours on Tuesday. The technical analysis of the daily chart indicates an ongoing bearish bias, as the pair trades within a descending channel pattern.

Gold sticks to gains above $5,350 amid sustained safe-haven demand; firmer USD caps gains

Gold sticks to its positive bias for the third straight day and trades above the $5,350 level heading into the European session on Tuesday. Concerns about a broader regional conflict in the Middle East continue to weigh on investors' sentiment and underpin demand for the traditional safe-haven bullion.

Stellar risks deeper losses as derivatives metrics turn negative

Stellar is trading red below $0.16 at the time of writing on Tuesday, after a slight recovery the previous day. Weakening derivatives data caps the recovery, while an unfavorable technical outlook projects a deeper correction for the XLM token in the upcoming days.

The market is not panicking it is repricing the probability distribution of Oil and time

At the end of the day, markets do not trade morality or geopolitics. They trade transmission channels. And the only channel that truly matters in this maelstrom runs through the price of energy and the time value of money.

Hyperliquid Price Forecast: HYPE rises on commodities demand amid US-Iran war

Hyperliquid (HYPE) steadies above $33 at press time on Tuesday, marking its fourth consecutive day of recovery in a broadly volatile market due to the ongoing US-Israel strikes on Iran.