24th February 2024: The euro tends to stabilize today against the US dollar, with its consolidation around the 1.08230 level. While the euro is trying to stop its losses against the British pound that have extended since yesterday, while the pair is still located near the 0.85447 level, which is close to the lowest levels for this week.

Today’s almost muted euro moves come with some slight improvement in confidence in the German economy in the February Ifo survey as well as despite Eurozone bond yields continuing to rise and approaching the highest levels this year.

Today, we witnessed the February reading of Ifo Business Climate Index in Germany, which came in line with expectations. The headline reading for the Business Climate Index came at 85.5, while the Business Expectations Index rose to 84.1, which was slightly higher than expected and the previous reading, in exchange for some decline in the Current Condition Index to 89.6.

The survey also indicated that future expectations remained low in manufacturing, services, and construction activities, and the latter in turn recorded the lowest levels of expectations since 1991. However, trade activities recorded a slight improvement in expectations.

The euro would have benefited from the rise in Eurozone bond yields and their approaching the highest levels since the beginning of last December, had it not been for an almost similar performance of US Treasury bond yields, which are also recording their highest levels this year.

Treasury’s yield rose with yesterday’s strong labor market figures and higher-than-expected growth in service activities. While the yield on ten-year German bunds reached 2.476%, which is slightly lower than this year’s peak of 2.5%.