Forex - EUR/USD, EUR/JPY Flows: Modest reaction on the EUR as German GDP falls as expected


 06:15 (GMT) 14 Aug

  [Forex Flows]

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EUR/USD, EUR/JPY Flows: Modest reaction on the EUR as German GDP falls as expected (0101-NGRH-C01)

Germany preliminary GDP (SA) slipped 0.1%q/q in the second quarter as market expected, though EUR/USD inched up a shade with stronger than expected figures on a non-SA basis as well as on calendar-adjusted basis. EUR/USD remains in the tight range of 1.1165/80 seen today. Market optimism following the tariffs delay announcement might be checked especially since markets have been disappointed more than a couple of times in terms of progress in trade talks in recent years. Focus might then revert back to weak growth data, from weak Chinese data overnight and now the GDP contraction in Germany. August 12 low at 1.1162 will be watched closely and if the euphoric risk mood fades, then there should be scope on the downside.
JPY has been broadly stronger in Asia, though might also be due to the overreaction in JPY pairs shortly after the tariffs delay announcement. EUR/JPY eased back below 119 in Asia and with a negative GDP print from Germany, the pair should not rise above the 118 handle.


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