GERMAN GDP, IFO REPORTS LIFT EURO

The shared currency was higher Tuesday after a number of economic reports from the euro zone.

EUR/USD was last seen at 1.0648, up 0.1%, while EUR/GBP jumped 0.22% to trade at 0.7038.

The Federal Statistics Office has just confirmed that Germany’s GDP rose by just 0.3% in the July-to-September quarter, matching analysts' expectations.

Exports rose by just 0.2% quarter-on-quarter, compared to estimates of a 0.4% rise. Imports, though, jumped by 1.1%.

And the resulting net trade deficit wiped 0.4% of Germany’s growth rate -- the weakest since 2013.

Europe’s powerhouse economy was left relying on domestic spending. Private consumption rose by 0.6% quarter-on-quarter, as German shoppers dipped into their wallets and purses. Government spending rose by 1.3% - the biggest increase since early 2009.

As an official at the Office explained, the refugee costs have played their role, and those are the first effects on state spending.

Higher imports may cheer critics who argue that Germany needs to spend more to help the euro zone economy rebound. But weaker exports highlight renewed weakness in developing markets.

Separately, the German research institute Ifo has reported that its Business Climate Index rose to a seasonally adjusted 109.0 this month from a reading of 108.2 in October, beating forecasts for 108.2.

The Current Assessment Index increased to 113.4 in November from 112.7 a month earlier and above expectations for 112.4. The Business Expectations Index, which measures attitudes related to business prospects over the next six months, rose to 104.7 this month from 103.9 in October, compared to expectatons for a reading of 104.0.

The monthly gauge is based on a survey of around 7,000 German firms in the manufacturing, construction, wholesale and retail sectors.

In France, business confidence rose less-than-expected in the last quarter. INSEE said in a report that French Business Confidence rose to an annual rate of 102, from 103 in the preceding quarter. Analysts had expected French Business Confidence to rise 103 in the last quarter.

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NOW YUAN IS IN THE ELITE CURRENCY CLUB, BUT EURO DOESN'T LIKE IT

The worst year for the euro can be even sadder: International Monetary Fund has included the Chinese yuan in the basket of reserve currencies. Now euro zone currency’s weighting in the IMF’s SDR basket will drop to 30.93 percent from 37.4 percent, the organization said yesterday. The yuan will join the dollar, euro, pound and yen in the SDR from Oct. 1, 2016. Its part will be approximately 10-11 percent.

This year the euro has tumbled 13 percent against the dollar yet, and central banks have reduced the proportion of the currency in their reserves to the lowest since 2002. European Central Bank President Mario Draghi signaled that they are open to boosting stimulus on the next ECB meeting.

“The euro will get the most impact from this weight adjustment,” said Douglas Borthwick, head of foreign exchange at Chapdelaine & Co. “The IMF is taking from euro to give to China; the other rebalancing amounts are largely negligible.”

Most likely, China’s yuan will exceed yen and sterling in the new IMF's basket. The levels will be 41.73 percent for the dollar, 8.33 percent for the yen and 8.09 percent for the pound, the IMF said.

It’s the first change in the SDR’s currency composition since 1999, when the euro replaced the Deutsche mark and French franc. The IMF reviews the basket every five years and rejected the yuan during the last review, in 2010.

The euro has dropped 5.3 percent this quarter against the dollar, it was at $1.0602 as of 13:15 GMT after reaching a seven-month low of $1.0558 on Monday.

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EURO LITTLE CHANGED AFTER REGIONAL DATA

The euro traded lower against the dollar on Thursday, despite several economic reports from the euro zone that were mostly positive.

Spain’s gross domestic product rose last month, in line with expectations.

Instituto Nacional de Estadistica said in a report that Spanish GDP rose to 0.8%, compared with 0.8% in the preceding month and matching analysts' forecasts.

Separately, there were a couple of economic reports from the European Central Bank which said that Euro Zone M3 Money Supply rose to 5.3%, from 4.9% in the preceding month. Analysts had expected Euro Zone M3 Money Supply to remain unchanged at 4.9% last month.

The ECB also reported that Euro Zone Private Sector Lending climbed to 1.2%, from 1.1% in the preceding month. Economists had expected it to rise to 1.2% last month.

A report from Reuters speculating that the ECB is discussing the introduction of two-tiered bank charges and a broader composition of asset purchases has boosted expectations for more aggressive easing to be announced at the December 3 meeting.

EUR/USD was last seen at 1.0610, down 0.12%.

EUR/GBP was higher 0.19% at 0.7036.

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EURO HIGHER AS EUROZONE INDUSTRIAL PRODUCTION DATA MATCHES EXPECTATIONS

The euro was higher against the greenback on Wednesday as industrial production in the euro area fell last month, however, matching analysts' expectations, official data showed earlier.

EUR/USD was last up 0.56%, at 1.1444.

The euro dipped against the stronger pound with EUR/GBP last seen at 0.7422, down 0.54%. The pound was boosted after an upbeat unemployment report in the U.K.

Eurostat said in a report that the euro area industrial production fell to a seasonally adjusted -0.5%, from 0.8% in the preceding month whose figure was revised up from 0.6%.

Analysts had expected eurozone industrial production to fall -0.5% last month.

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EURO DROPS AS GERMAN INFLATION RATE TURNS NEGATIVE AGAIN

Germany’s inflation rate has turned negative, for the first time since January.

The German consumer prices index fell by 0.2% year-on-year this month, according to new data from the Federal Statistics Office.

Analysts had expected the CPI to be unchanged; this negative reading could intensify calls for the European Central Bank to increase its QE programme.

The euro gave up 0.28% to trade at 1.1212 against the dollar.

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PRESSURE ON GREEK ECONOMY IRRESPECTIVE OF REFERENDUM

Deutsche Bank About Before And After The Greek Referendum - strong pressure on the Greek economy irrespective of this weekend's referendum:

"A "yes" vote would be significantly more likely to lead to a quicker agreement with the creditors, but not without risks," DB argues.
"A “no” vote would open a wider range of possibilities. This notwithstanding, any agreement would likely require change that leads to a re-building of trust between Greece and its creditors," DB adds.
"Ultimately, the continued strong pressure on the Greek economy and the government's weak cash position will remain important catalysts for future developments, irrespective of this weekend's referendum," DB projects.

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