When are the German IFO surveys and how they could affect EUR/USD?

The German IFO Business Surveys Overview

The German IFO surveys for July are lined up for release later today at 0800 GMT. The headline IFO Business Climate Index is expected to drop further to 101.5 in July. The Current Assessment sub-index is also seen lower at 104.8 this month, while the IFO Expectations Index – indicating firms’ projections for the next six months – is likely to drop to 98.1 in the reported month.

Deviation impact on EUR/USD

Readers can find FX Street's proprietary deviation impact map of the event below. As observed the reaction is likely to remain confined between 3 and 40 pips in deviations up to 2.4 to -3.2, although in some cases, if notable enough, a deviation can fuel movements of up to 60 pips.

 How could affect EUR/USD?

The spot could drop below the 1.1650 levels on a bigger-than-expected drop in the IFO readings while the EUR/USD pair could re-attempt the 1.17 handle on a positive surprise across all the indicators.

According to Karen Jones, Analyst at Commerzbank, “EUR/USD is currently sidelined and possibly basing, but has so far been rejected by the near term resistance line at 1.1746. For now, we will assume while below 1.1790, a downside bias remains, however, the market is fairly neutral currently. Attention stays on the 1.1510/08 recent lows and below here lies the 200 week ma at 1.1379. A recovery above 1.1790 will target 1.1855. Above 1.1855 we look for a deeper retracement to the 1.1937 55 week ma, with scope for the 1.1981 200 day ma, where we suspect that it will fail.”

Key Notes

EUR/USD Still holding on at the bottom of the bullish channel

How to trade the German IFO Business Climate with EUR/USD

EUR/USD Forecast: Directionless ahead of Trump-Juncker meet and ECB

About the German IFO Business Climate

This German business sentiment index released by the CESifo Group is closely watched as an early indicator of current conditions and business expectations in Germany. The Institute surveys more than 7,000 enterprises on their assessment of the business situation and their short-term planning. The positive economic growth anticipates bullish movements for the EUR, while a low reading is seen as negative (or bearish).