DAX Continues to Decrease After German GDP Data

Forex News

The indicators of Germany and the Eurozone were weak this week, and caused a decline in DAX. The index lost 6.0% of its value this month. Today, the DAX continued downtrend, losing 0.20%. At present, the index is trading at the level of 12.437.00. Germany's gross domestic product grew by 0.6% in Q4 2017, but growth was slower than the 0.7% expansion observed in the third quarter. Reading coincided with the forecast of economists. On an annualized basis, GDP increased at a faster rate, 2.9%, after rising 2.7% in the previous quarter. For the full year 2017, Germany's GDP grew by 2.2% compared to 1.9% growth in 2016.

Consumer price growth in the Eurozone slowed somewhat in January, but the basic measure, which is tracked by the European Central Bank, rose slightly for the first time in recent months. Eurostat data showed that consumer prices, in the 19 countries sharing the euro, fell by 0.9% compared to the previous month in January and rose by 1.3% year-on-year, confirming earlier estimates and expectations. Another broader core inflation rate, which excludes prices for alcohol and tobacco, also increased to 1.0% year-on-year in January from 0.9%in the previous three months.

The Fed's protocol, which was published this week, showed that the pace of rate hikes could accelerate this year. But still, the rate hike will depend on the economic conditions in the US. Politicians expect that the rate of economic growth in 2018 will exceed their estimates and that the labor market conditions will be further strengthened.