Single Currency Growing, Impressive German Business Climate
The single currency has mildly improved, as Euro/Dollar lifted 0.13% to trade at 1.1866. German Ifo Business Climate rose to 117.5. Final Q3 Gross Domestic Product increased to 0.8%, marking a 3-year maximum. Manufacturing PMI hit the 7-year maximum of 62.5. As we can see, German maintains its position of the strongest Eurozone economy. No data from the US today. Recent FOMC protocol showed that members are worried that such a soft inflation won’t pick any time soon. December’s rate hike remains in store, but it’s doubtful that there would be 3 rate hikes next year.
Angela Merkel didn’t manage to create a coalition with Free Democratic Party and Greens. The Chancellor is about to negotiate with leaders and figure it out, but so far, Germany will remain in the standby mode. Frank-Walter Steinmeier claimed that so far there is no need in arranging new election and that leaders of parties should take some time and mull the whole situation. But, if there is no progress negotiations, they would be forced to call the election. The appreciation of Angela Merkel has strongly sunk. It seems that the majority would prefer new election and not many people think that Angela Merkel will become a Chancellor again.