German ZEW Survey - Economic Sentiment unexpectedly improves to -10.2 in May

Lallalit Srijandorn FXStreet

German ZEW Survey - Economic Sentiment unexpectedly improves to -10.2 in May, while it was expected to deteriorate further to -19.8 from -17.2 in April.

The ZEW Survey - Current Situation deteriorates further to -77.8 from the previous reading of -73.7.

In the Eurozone, the ZEW Survey - Economic Sentiment has also improved. The sentiment data has arrived better at -9.1 than April reading of -20.4. The data was expected to improve nominally to -20.

Market reaction

No meaningful impact of the German sentiment data on the Euro (EUR) was observed. The risk-off market sentiment continues to drive EUR/USD, which is trading 0.3% lower to near 1.1745.

Euro Price Today

The table below shows the percentage change of Euro (EUR) against listed major currencies today. Euro was the strongest against the British Pound.

	USD	EUR	GBP	JPY	CAD	AUD	NZD	CHF
USD		0.31%	0.57%	0.27%	0.20%	0.46%	0.31%	0.36%
EUR	-0.31%		0.26%	-0.02%	-0.14%	0.14%	-0.02%	0.05%
GBP	-0.57%	-0.26%		-0.30%	-0.41%	-0.13%	-0.27%	-0.22%
JPY	-0.27%	0.02%	0.30%		-0.10%	0.16%	0.02%	0.07%
CAD	-0.20%	0.14%	0.41%	0.10%		0.26%	0.11%	0.16%
AUD	-0.46%	-0.14%	0.13%	-0.16%	-0.26%		-0.13%	-0.09%
NZD	-0.31%	0.02%	0.27%	-0.02%	-0.11%	0.13%		0.04%
CHF	-0.36%	-0.05%	0.22%	-0.07%	-0.16%	0.09%	-0.04%

The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Euro from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent EUR (base)/USD (quote).

(This section below was published at 06:44 GMT as a preview of the German ZEW Survey data for May)

German ZEW Survey Overview

The Zentrum für Europäische Wirtschaftsforschung (ZEW) will release its German Economic Sentiment Index and the Current Situation Index for May at 09:00 GMT later on Tuesday.

ZEW Survey – Economic Sentiment Index for Germany is expected to fall to -19.8 in May, from -17.2 in April. Meanwhile, the Current Situation Sub-Index is expected to drop to -77.5 in the reported month, down from the previous reading of -73.7.

ZEW Survey – Economic Sentiment in Eurozone is expected to decline to -20, slightly improving from -20.4 previously.

How could the German ZEW Survey affect EUR/USD?

EUR/USD trades on a negative note on the day in the lead up to ZEW Survey. The major pair declines as tensions between the United States (US) and Iran remain high, boosting demand for a safe-haven currency such as the US Dollar (USD).

If data comes in better than expected, it could lift the Euro (EUR), with the first upside barrier seen at the May 8 high of 1.1788. The next resistance level emerges at the 1.1800 psychological level, en route to the April 17 high of 1.1849.

To the downside, the May 7 low of 1.1722 will offer some comfort to buyers. Extended losses could see a drop to the 100-day Exponential Moving Average (EMA) of 1.1685, followed by the April 30 low of 1.1655.

(This story was corrected on May 12 at 07:42 GMT to say that the Economic Sentiment Index for Germany is expected to fall to -19.8 in May from -17.2 in April, not from 17.2 in April.)

Economic Indicator

ZEW Survey – Economic Sentiment

The Economic Sentiment published by the Zentrum für Europäische Wirtschaftsforschung measures the institutional investor sentiment, reflecting the difference between the share of investors that are optimistic and the share of analysts that are pessimistic. A positive number means that the share of optimists outweighs the share of pessimists. usually, an optimistic view is considered as positive (or bullish) for the EUR, whereas a pessimistic view is considered as negative (or bearish).

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