Investing.com - The euro fell to eight month lows against the dollar on Friday as weaker than expected German economic data underlined concerns over the diverging monetary policy path between the European Central Bank and other central banks.
EUR/USD was down 0.25% to 1.3429 at the close, reaching the lowest level since November. For the week, the pair lost 0.74%.
The drop in the euro came after a report showed that Germany’s Ifo business climate index dropped to 108.0 in July, missing estimates for a reading of 109.4. It was the third consecutive monthly decline.
The data added concerns over the outlook for the euro zone’s largest economy. The euro has come under pressure since the ECB cut rates to record lows on June 5, in a bid to stave off the risk of deflation and shore up growth in the region.
Sentiment on the single currency was also hit by concerns that tougher sanctions on Russia would have a negative impact on the outlook for growth in the currency bloc, which has close trade ties with Moscow.
EUR/JPY was down 0.23% to 136.75 late Friday, not far from the five month lows of 136.35 reached in the previous session.
Elsewhere, the dollar was steady close to three week highs against the yen, with USD/JPY inching up 0.02% to 101.82 late Friday. Against the Swiss franc the dollar rose to five month highs, with USD/CHF up 0.24% to 0.9047.
The US Dollar Index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 0.25% to 81.15 late Friday.
Elsewhere, the greenback rose to more than one month highs against the Canadian dollar on Friday, with USD/CAD advancing 0.64% to 1.0811. The commodity linked Australian and New Zealand dollars were also weaker, with AUD/USD down 0.24% to 0.9394 and NZD/USD down 0.22% to 0.8553.
The greenback was boosted by better than expected data on U.S. durable goods orders for June.
The Commerce Department reported a rise of 0.7% in orders of long lasting goods such as machinery and electronic products, compared to forecasts of 0.5%.
In the week ahead, investors will be focusing on Wednesday’s revised reading on U.S. second quarter growth, while Friday’s nonfarm payrolls report will also be in focus. Wednesday’s Fed statement will also be closely watched for any indications that the central bank is moving closer to raising rates.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, July 28
The U.S. is to release data on pending home sales.
Tuesday, July 29
Japan is to publish data on household spending and retail sales.
The U.K. is to release data on net lending.
Later Tuesday, the U.S. is to publish reports on house price inflation and consumer confidence.
Wednesday, July 30
New Zealand is to produce data on building consents.
Japan is to publish a preliminary report on industrial production.
In the euro zone, Germany is to release preliminary data on consumer price inflation, while Spain is to publish flash estimates on consumer inflation and second quarter economic growth.
Switzerland is to publish its KOF economic barometer.
The U.S. is to release the ADP report on private sector job creation, which leads the government’s nonfarm payrolls report by two days. The U.S. is also to publish revised data on second quarter growth.
Canada is to release a report on raw material price inflation.
Later Wednesday, the Federal Reserve is to announce its federal funds rate and publish its rate statement.
Thursday, July 31
Australia is to release data on building approvals and import prices.
Japan is to release data on average cash earnings.
The U.K. is to produce private sector data on house price inflation.
The euro zone is to release preliminary data on consumer inflation and unemployment, while Germany is to publish data on retail sales and unemployment.
Canada is to publish its monthly report on gross domestic product.
The U.S. is to release the weekly report on initial jobless claims, as well as data on manufacturing activity in the Chicago area.
Friday, August 1
China is to release official data on manufacturing activity, as well as the revised reading of the HSBC manufacturing index.
Australia is to publish data on producer price inflation.
Bank of Japan Governor Haruhiko Kuroda is to speak at an event in Tokyo; his comments will be closely watched.
Markets in Switzerland will remain closed for a national holiday.
The U.K. is to release data on manufacturing activity.
The U.S. is to round up the week with what will be closely watched government data on nonfarm payrolls and the unemployment rate, while the Institute of Supply Management is to release data on manufacturing activity.