EUR/USD Fails to Find Support from Euro Area Industrial Production

It was a quiet day for the EUR/USD on the economic calendar. Following bullish economic indicators last week, Eurozone industrial production was in the spotlight today.

Industrial production across the euro area rose by 0.9% in September versus 2.0% in August. Economists forecast a 0.3% increase.

According to Eurostat,

• Compared with August 2022, the production of non-durable consumer goods jumped by 3.6% and capital goods by 1.5%.

• However, the production of intermediate goods and durable consumer goods both fell by 0.9% and energy by 1.1%.

• Ireland (+11.9%) and Belgium (+7.1%) registered the highest increases in industrial production. Lithuania (-8.2%), Greece (-4.5%), and Estonia (-3.6%) saw the most marked declines.

• Year-over-year, production across the euro area increased by 4.9% versus 2.8% in August. (Economists forecast a rise of 2.8%).

Uncertainty over ECB monetary policy had left the EUR/USD on the back foot this morning. While today‘s numbers show how the Eurozone manufacturing sector is performing, the stats are unlikely to influence the ECB’s policy goals to bring inflation to target.

Last week, ECB President Lagarde reiterated the need to hike rates to bring high inflation under control. The ECB President will speak again later this week.

ECB members Fabio Panetta, Andrea Enria, and Luis de Guindos speak today. Hawkish chatter would deliver EUR/USD support. The markets are still second-guessing what the ECB has planned for December.

The EU Growth Forecasts added more uncertainty on what to expect on Friday. While upwardly revising growth forecasts for 2022 from 2.7% to 3.2%, the EU Commission downwardly revised growth forecasts for 2023 from 1.4% to 0.3%.

The EU Commission expects inflation to sit at 8.5% this year before softening to 6.1% in 2023.

EUR/USD Price Action

At the time of writing, the EUR/USD was down 0.59% to $1.02926.

Ahead of todays numbers, the EUR/USD rose to a high of $1.03542 before falling to a pre-stat low of $1.02978.

However, in response to the industrial production figures, the EUR/USD slid to a low of $1.02901.