When is the German IFO survey and how it could affect EUR/USD?

The German IFO Business Survey Overview

The German IFO survey for September is lined up for release later today at 0800 GMT. The headline IFO Business Climate Index is expected to rise slightly to 94.5 versus 94.3 previous.

The Current Assessment sub-index is seen weaker at 97.0 this month, while the IFO Expectations Index – indicating firms’ projections for the next six months – is likely to arrive at 91.8 in the reported month vs. 91.3 last.

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?

According to Haresh Menghani, Analyst at FXStreet, “From a technical perspective, the overnight fall and a subsequent acceptance below the key 1.10 psychological mark already seem to have set the stage for a slide back towards challenging 2019 swing lows support near the 1.0925 region. A follow-through selling might now turn the pair vulnerable to break below the 1.0900 round-figure mark and accelerate the fall further towards testing its next major support near the 1.0840-35 region.”

“On the flip side, any attempted recovery back above the 1.10 handle might now confront some fresh supply near the 1.1020-25 region, which if cleared might prompt some short-covering move and provide a minor boost to the major. However, any further move up seems more likely to remain capped near a three-month-old descending trend-line resistance, currently around the 1.1060 region,” Haresh adds.

Key Notes

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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).