By Rita Ruvinski – The EUR pared its losses vs. the U.S dollar after German business confidence rose to its highest level since July 2008. The Ifo institute in Munich reported today its business climate index increased to 95.8 from 94.6 in December, ensuring Germany’s economy continues to expand. The European single currency rose after the report to $1.4103 from $1.4084.
Against the British pound the EUR rose 0.3% at 0.8725, with a stronger-than-forecast reading of the key Ifo Institute’s German business climate gauge helping the shared currency to outperform GBP.
But although a temporary rebound is possible, the overriding picture argues in favor of continued EUR weakness. The European currency continue to weaken against the U.S dollar after the ECB member said that the central bank is concerned about the sharp rise forecast for public deficits and debt in euro member countries.
Attention is now focused on this week’s European Unemployment Rate figure published on Friday at 10:00 GMT. After rising 0.1% every month, the Euro-zone’s unemployment rate rose by 0.2% and reached the alarming number of 10%, weighing on the single currency
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