- POSTED: 26 Jul 2014 06:34
The euro on Friday (25 July) declined against other major currencies following a gloomy report on German business confidence.
NEW YORK: The euro on Friday (25 July) declined against other major currencies following a gloomy report on German business confidence.
The single currency hit a new eight-month low after the Ifo economic institute's closely watched business climate index for Germany fell sharply to 108.0 points in July from 109.7 points in June.
It was the third monthly drop in a row and took the measure of sentiment in Europe's biggest economy to its lowest level since October 2013.
The institute cited geopolitical tensions as a drag on the German economy given ongoing fighting in Ukraine and the Middle East.
The data came a day after the Eurozone economy showed signs of a rebound in July after several months of sluggish activity, while its second-biggest economic power, France, lagged behind.
Joe Manimbo, senior market analyst at Western Union Business Solutions, said worries about the euro are heightened in light of potentially tougher European Union sanctions on Russia, a major Eurozone trading partner.
"The weight of the negative factors driving the euro has the potential to push it further southward over the short run," Manimbo said.
Kathy Lien, analyst at BK Asset Management, said the Ifo report capped an "extremely difficult week for the euro."
The single currency could fall further if a trove of economic data from the region next week is disappointing, Lien said.
But more likely "these economic reports will be mixed, providing support to the single currency," she said.