Euro weakens vs. US dollar as risk appetite wanes

The euro weakened by 0.84 cents (0.60%) against the US dollar on Friday to finish the day at $1.3934.

• In trading on Friday, the euro weakened against the dollar following the onset of the US corporate earnings season. This contributed to a growing sense of unease about the global economic recovery, reducing appetite for riskier currencies like the euro.
  
• Further falls in equity markets, commodities and emerging market currencies also weighed on the single currency, as did cautious comments on the global outlook from the IMF and G8 meeting in Italy.
  
• However, the euro’s falls were stemmed to some extent as investors took heart from Wednesday’s German industrial output figures released earlier in the week. They suggested the eurozone may hold up better than many had feared.
  
• In addition, monthly French industrial production also came in stronger-than-forecast on Friday, registering at 2.6% from -1.5% last month and ahead of analyst forecasts of -0.1%.
  
• There are no major announcements due in the eurozone today, whilst in the US the Federal Budget Balance is due at 14.00 BST.