Weak Euro Zone Economic Data Causes Euro’s fall against the U.S. Dollar
The Euro fell versus the U.S. Dollar today following growing risk aversion, prior to the release of U.S. employment figures. According to most analysts, the U.S. data will show a sharp decline because of the intensity of the global economic downturn.
The Euro retreated after Germany’s October manufacturing data showed a fall of 6.1% on the month, while declining share prices in the Euro Zone also put pressure on the single currency.
The U.S. Dollar gained traction, raising the U.S. Dollar index by 0.5% to 87.030 .DXY while investors reduced risky positions prior to the release of the U.S. non-farm payroll data for November. According to analysts, the data will show a fall of about 340,000.
On December 5, 2008 at 12:08 GMT, the Euro fell by 0.7% against the U.S. Dollar and traded at $1.2675, while the U.S. Dollar rose by 0.1% against the Japanese Yen and traded at 92.23 Yen. Shares in the Euro zone fall by almost 2% and as a result the currency came under pressure to sell.
Investors concerns over the state of the world-wide economy have negatively affected stock markets and other assets which investors deemed risky, and as a result investors have moved away from higher-yielding currencies like the Euro, Pound Sterling and the New Zealand and Australian Dollars into the U.S Dollars and Japanese Yen.