Euro comes under broad selling pressure

The euro came under broad selling pressure yesterday as European share prices fell and there was a record contraction in the eurozone economy during the fourth quarter of last year. The eurozone economy contracted 1.5% on an annualised basis, which was revised downwards from an expected 1.3%, confirming the current economic plight that many European countries are finding themselves in. It was also confirmed that UK manufacturing output fell by a record amount year-on year in February according to the Office of National Statistics, with output falling 0.9% in the month. However, the fall was less than the 1.5% many were expecting, in a sign that the recession may be bottoming out.

In early trading today, the pound is hovering around the 1.1100 mark as the euro remains on the back foot following yesterday’s poor performance. Both the pound and the single currency will take further direction from equity markets, as well as factory orders data being released in Germany, and the British Retail Consortium releasing their shop price index.