Mixed week for the euro as it was driven by counter currency influences, while the Swiss franc takes the lead thanks to risk aversion sentiment and more intervention commentary from the SNB.
European Headlines and Economic data
- German economy unlikely to keep growth pace in second quarter – Bundesbank
- Bundesbank Says German Economy Still Weak Despite Recent Pickup
- German PPI rise 0.5% to 105.40 versus the -0.1% slowdown in the previous month
- In March 2019 the current account of the euro area recorded a surplus of €25 billion, compared with a surplus of €28 billion in February 2019
- Euro area consumer confidence picked up by 0.8 points to -6.5, above the respective long-term average of −10.7
- Flash Eurozone Manufacturing PMI at 47.7 (47.9 in April). 2-month low
- ECB minutes show declining confidence in growth recovery
- Drop in German business morale points to meager growth
- Pro-EU Dutch parties see surprise gains in first results of EU election4 nations vote in high-stakes European Union election
- EU vote may shift power in main euro zone states, stall integration
The Swiss Franc
Swiss Headlines and Economic data
No major drivers for the Swiss franc coming from Switzerland, with exception to another round of “currency intervention” talk from SNB officials. This time it was Thomas Moser who reiterated the intervention sentiment at a conference in Copenhagen on Monday. This event correlates with early franc strength in the week, which eventually carried on throughout the whole week due to a rise in global risk aversion sentiment.
With geopolitical fears growing on many fronts (including the U.S.-China trade tensions, growing possibility of conflict between the U.S. and Iran, and the never ending Brexit drama that picked up in intensity with May’s resignation) it’s highly likely traders exited higher risk/yielding plays and moving into safe haven as evidenced by the franc’s broad gains to take one of the top spots among the major currencies this week.