The German IFO index beat market expectations sending EUR/USD to fresh year to date highs as investors continued to bet on an economic rebound in the Eurozone. IFO printed at 104.2 versus 103.00 forecast while the expectations index hit 100.5 above 99.00 anticipated.
The positive reading comes on the heels of much better than expected results from the ZEW survey earlier in the week and stronger flash PMI data out of Germany yesterday showing clear evidence that the economic climate in EZ largest economy is improving as we start the new year.
The news has given investors hope that the dour economic growth projections by the ECB may have been too pessimistic and currency markets pushed the EUR/USD through the 1.3400 ahead of the data and kept the rally going in the aftermath of the release as the pair targeted the 1.3450 level in morning European dealing. With EUR/USD now above the yearly highs the bulls will try to press their case towards the psychologically key 1.3500 barrier as the day proceeds.