THE TAKEAWAY: [Euro-zone consumer confidence rose to -23.5, less than expected] > [ Negotiations on Cyprus bail-out plan and weak economic growth drag on consumer confidence] > [EURUSD Neutral]
Euro-zone consumer confidence increased for the fourth consecutive month in March but fell short of the expectation amid the ongoing crisis and weak economic growth in the euro area. According to a report released by European Commission in Brussels today, the index of household confidence climbed to -23.5 in March following a rise to -23.6 in February. The consensus estimate of 26 economists surveyed by Bloomberg News had projected a larger increase to -23.2.
The confidence indicator measures four aspects in the euro area: the financial situation of households, the general economic situation, unemployment expectations and savings. Output in the core countries had little improvement with GDP falling by 0.6% in Germany and 0.3% in France. In addition, the unstable coalition government in Italy and ongoing debates over the bail-out plan in Cyprus add more risks to the region and may continue to drag on the economic growth and consumer confidence.
EURUSD 1-minute Chart: March 20, 2013
Chart created using Marketscope 2.0– Prepared by Renee Mu
In the minutes following the data release, the euro little changed against the US dollar. At the time of this report was written, the EURUSD was trading lower at $1.2944.
--- Written by Renee Mu DailyFX Research
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