The euro made headway on Tuesday, with EURUSD testing former trendline support at 1.4150, after the release of the German ZEW survey, as the index of investor sentiment was much better than expected.
Indeed, the gauge measuring economic expectations increased to a more than 3-year high of 56.1 in August from 39.8, while the index measuring sentiment on the current situation edged up to a 7-month high of -77.2 from -89.3. Overall, the steady rise in equities since March was indicative of a recovery in risk appetite, though that tide seems to be shifting at the moment.
The Swiss franc counted itself as the third weakest of the majors, as the currency has maintained its status as a safe-haven currency. There was no Swiss data on hand, but there was important commentary on the wires. Swiss National Bank board member Thomas Jordan was quoted in a newspaper as saying that the SNB saw the US and European recession easing, that recovery in Europe will begin in early 2010, though it will be weak and faces downside risks. On intervention, Jordan said that the SNB is content with the current EURCHF range and that the market has understood the central bank’s intervention policy well. At the same time, he said that the SNB will continue purchases of franc bonds and that it’s too early to start normalizing SNB policy.
Check out the Daily Fundamentals in its entirety for a look at what happened across the majors.
