Overview
Germany, Eurozone's manufacturing powerhouse, will publish Industrial Production data for February at 06:00 GMT.
The output is forecasted to have contracted by 0.9% month-on-month, having risen by 3% in the previous month. The annualized figure is expected to come in at -3.9% compared to -1.3% in January.
Downturn eased in February?
The downturn in Germany's manufacturing sector eased in February, despite coronavirus-led supply chain disruption, according to IHS Markit/BME Manufacturing Purchasing Managers' Index (PMI).
The headline figure rose to a 13-month high of 48.0 in February, up from January's reading of 45.3. The upward pressure came from of its component, with output, new orders, employment and stocks of purchases each falling at slower rates, according to the official report.
A reading below 50 indices contraction, however, the rise from 45.3 to 48.00 represents an easing of the rate of contraction.
As a result, the possibility of Germany's industrial production bettering estimates cannot be ruled out.
Impact on EUR/USD
Macro data dating back to February is of little relevance now, as it is generally accepted by now that the coronavirus outbreak, which gathered pace across the Eurozone in March, may have pushed the economy into a recession.
As a result, a big beat in Germany's industrial production for February may not yield a big positive reaction in EUR/USD, more so, as the futures tied to the S&P 500 futures are currently reporting a 0.60% drop and could draw bids for the US dollar.
On the other hand, if the data shows the manufacturing output was already facing renewed slowdown ahead of the coronavirus crisis seen in March, the single currency may go on the offer, possibly challenging support at 1.0770. The pair has bounced at least two times from that level since Friday.
About German Industrial Production
The Industrial Production released by the Statistisches Bundesamt Deutschland measures outputs of the German factories and mines. Changes in industrial production are widely followed as a major indicator of strength in the manufacturing sector. A high reading is seen as positive (or bullish) for the EUR, whereas a low reading is seen as negative (or bearish).
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
AUD/USD: The hunt for the 0.7000 hurdle
AUD/USD quickly left behind Wednesday’s strong pullback and rose markedly past the 0.6900 barrier on Thursday, boosted by news of fresh stimulus in China as well as renewed weakness in the US Dollar.
EUR/USD refocuses its attention to 1.1200 and above
Rising appetite for the risk-associated assets, the offered stance in the Greenback and Chinese stimulus all contributed to the resurgence of the upside momentum in EUR/USD, which managed to retest the 1.1190 zone on Thursday.
Gold holding at higher ground at around $2,670
Gold breaks to new high of $2,673 on Thursday. Falling interest rates globally, intensifying geopolitical conflicts and heightened Fed easing bets are the main factors.
Bitcoin displays bullish signals amid supportive macroeconomic developments and growing institutional demand
Bitcoin (BTC) trades slightly up, around $64,000 on Thursday, following a rejection from the upper consolidation level of $64,700 the previous day. BTC’s price has been consolidating between $62,000 and $64,700 for the past week.
RBA widely expected to keep key interest rate unchanged amid persisting price pressures
The Reserve Bank of Australia is likely to continue bucking the trend adopted by major central banks of the dovish policy pivot, opting to maintain the policy for the seventh consecutive meeting on Tuesday.
Five best Forex brokers in 2024
VERIFIED Choosing the best Forex broker in 2024 requires careful consideration of certain essential factors. With the wide array of options available, it is crucial to find a broker that aligns with your trading style, experience level, and financial goals.