The German ZEW Economic Sentiment was released yesterday, and came in at a 10-month low for the August survey. The sentiment, which was expected at 14, posted a disappointing 10.0, a decline from its previous 17.5. Such a figure indicates low investor confidence in the economy, for the next six months and will potentially have a negative impact on currency growth. This has been the third consecutive drop since May. The major contributing factors to this are thought to be weaker exports and ongoing scandals in the automotive industry.
The Loonie strengthened to its strongest level in three weeks against the Dollar yesterday afternoon as the Core Retail Sales figure for June exceeded expectations. The core figure posted a bullish 0.7%. Retail Sales has now posted gains for four months straight, as sales at general merchandise stores rose to 2.9%, with clothing and clothing accessories stores rising by 2.7%. However, sales in petrol have decreased by 1.8%.
This morning the markets will be focusing on the Eurozone with the release of the Flash Manufacturing and Services PMIs, as well as the individual versions of the readings from two of Europe’s largest economies; France and Germany. ECB President Mario Draghi will also be delivering the opening speech at the 6th Lindau Meeting on Economic Sciences. With Draghi not expected to talk about his thoughts on the ECB’s taping at Jackson Hole, the markets will be looking at his speech today for any indications as to his thoughts. In the afternoon, the US will release the Flash Manufacturing and Services PMI’s. The day will end with the release of the US Crude Oil Inventories.