Euro Gains Modestly After German Election , But Coalition Uncertainty Keeps Rally in Check
| Action Insight Daily Report 2-24-25 |
Euro Gains Modestly After German Election , But Coalition Uncertainty Keeps Rally in Check |
Euro opened the week slightly higher against all major currencies, as traders reacted positively to the German election results. Conservatives CDU/CSU secured victory, setting Friedrich Merz up as the next chancellor. However, Euro's gains remain limited, as uncertainty over coalition talks persists, with negotiations potentially dragging on until Easter. While Merz’s CDU/CSU emerged as the largest party, winning 28.5% of the vote, it was far from a decisive mandate, leaving him in a weakened position for coalition negotiations. The far-right AfD secured second place, marking its best-ever result. However, Merz has ruled out coalition talks with AfD, meaning a broader, more traditional coalition will be needed. It remains unclear whether Merz will require one or two partners to form a government. Given the complexity of the negotiations, analysts expect haggling could last until Easter, prolonging political uncertainty in Europe's largest economy.... |
EUR/GBP Daily Outlook Daily Pivots: (S1) 0.8266; (P) 0.8279; (R1) 0.8293; More... Intraday bias in EUR/GBP is turned neutral first with current recovery. Another fall is expected as long as 0.8308 minor resistance holds. Below 0.8264 will resume the whole decline from 0.8472 to retest 0.8221 low. Nevertheless, firm break of 0.8308 minor resistance will turn bias back to the upside for stronger rebound to 0.8376 resistance instead. | |
| GMT | Ccy | Events | Actual | Forecast | Previous | Revised |
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| 21:45 | NZD | Retail Sales Q/Q Q4 | 0.90% | 0.60% | -0.10% | 0.00% | | 21:45 | NZD | Retail Sales ex Autos Q/Q Q4 | 1.40% | 0.30% | -0.80% | -0.60% | | 09:00 | EUR | Germany IFO Business Climate Feb | 85.8 | 85.1 | | 09:00 | EUR | Germany IFO Current Assessment Feb | 86.5 | 86.1 | | 09:00 | EUR | Germany IFO Expectations Feb | 85.2 | 84.2 | | 10:00 | EUR | Eurozone CPI Y/Y Jan F | 2.50% | 2.50% | | 10:00 | EUR | Eurozone CPI Core Y/Y Jan F | 2.70% | 2.70% |
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