When is the German IFO survey and how it could affect EUR/USD?

Dhwani Mehta FXStreet

The German IFO Business Survey Overview

The German IFO survey for October is due for release later today at 0900 GMT. The headline IFO Business Climate Index is seen decelerating to 92.7 versus 93.4 previous.

The Current Assessment sub-index is seen arriving at 89.7 this month vs. 89.2 prior while the IFO Expectations Index – indicating firms’ projections for the next six months – is likely to come in at 96.0 in the reported month vs. 97.7 last.

Deviation impact on EUR/USD

Readers can find FX Street's proprietary deviation impact map of the event below. As observed the reaction is likely to remain confined between 3 and 30 pips in deviations up to 3.0 to -4.2, although in some cases, if notable enough, a deviation can fuel movements of up to 60 pips.

How could affect EUR/USD?

EUR/USD is consolidating near daily lows of 1.1829 before resuming the next leg lower. Surging coronavirus cases in Europe and the resultant fresh lockdowns imposed in the key economies such as France, Italy and Spain are weighing negatively on the shared currency.

Meanwhile, the US dollar cheers safe-haven demand amid coronavirus resurgence and fading US fiscal hopes, collaborating with the downside in the main currency pair.

Ahead of the German IFO Survey, the spot drops 0.23% to 1.1831, with the immediate support seen at the 10 and 50-DMAs confluence of 1.1798/95. The next cushion awaits at 1.1778 (20-DMA). To the upside, the spot will resistance around 1.1850 (5-DMA/ pivot point), above which Friday’s high of 1.1866 could be tested.

Key notes

Coronavirus update: Germany’s new cases rise by 8,685, Australian state of Victoria reports no new infections

EUR/USD Forecast: Bulls await sustained move beyond 61.8% Fibo. hurdle

Euro falls as Spain and Italy unveil sweeping circuit-breaker rules

About the German IFO Business Climate

This German business sentiment index released by the CESifo Group is closely watched as an early indicator of current conditions and business expectations in Germany. The Institute surveys more than 7,000 enterprises on their assessment of the business situation and their short-term planning. The positive economic growth anticipates bullish movements for the EUR, while a low reading is seen as negative (or bearish).

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 looks sidelined around 1.1850

EUR/USD remains on the back foot, extending its bearish tone and sliding towards the 1.1850 area to print fresh daily lows on Monday. The move lower comes as the US Dollar gathers modest traction, with thin liquidity and subdued volatility amplifying price swings amid the US market holiday.

GBP/USD flirts with daily lows near 1.3630

GBP/USD has quickly given back Friday’s solid gains, turning lower at the start of the week and drifting back towards the 1.3630 area. The focus now shifts squarely to Tuesday’s UK labour market report, which is likely to keep the quid firmly in the spotlight and could set the tone for Cable’s next move.

Gold loses momentum, eases below $5,000

Gold is giving back part of Friday’s sharp rebound, deflating below the key $5,000 mark per troy ounce as the new week gets underway. Modest gains in the US Dollar are keeping the metal in check, while thin trading conditions, due to the Presidents Day holiday in the US, are adding to the choppy and hesitant tone across markets.

Bitcoin consolidates as on-chain data show mixed signals

Bitcoin price has consolidated between $65,700 and $72,000 over the past nine days, with no clear directional bias. US-listed spot ETFs recorded a $359.91 million weekly outflow, marking the fourth consecutive week of withdrawals.

The week ahead: Key inflation readings and why the AI trade could be overdone

It is likely to be a quiet start to the week, with US markets closed on Monday for Presidents Day. European markets are higher across the board and gold is clinging to the $5,000 level after the tamer than expected CPI report in the US reduced haven flows to precious metals.

XRP steadies in narrow range as fund inflows, futures interest rise

Ripple is trading in a narrow range between $1.45 (immediate support) and $1.50 (resistance) at the time of writing on Monday. The remittance token extended its recovery last week, peaking at $1.67 on Sunday from the weekly open at $1.43.