Economic data from China is helping support the Single Currency for the moment, keeping it from plunging since one of the world’s largest powerhouses showed Gross Domestic Product and industrial output expanded more than analysts predicted, as the economy maintains momentum after monetary tightening to cool inflation.
Second-quarter gross domestic product rose 9.5 percent from a year earlier, China reported today, surpassing economists’ forecasts for 9.4 percent growth.
This comforted markets and gave much needed boost to investor confidence who were concerned over Euro zone debt and overall global economic recovery.
“This data should dispel concerns over a hard landing in China,” said Wendy Liu, a Hong Kong-based analyst with Royal Bank of Scotland..
The Euro stabilised into a range between 1.3950 and 1.4050 moving off Tuesday’s fluctuations that brought it to a four-month low of $1.3836.
“I guess we’ve already seen selling climax for the moment. But the market is still a bit shocked, so trade is thin and volatile,” said a trader at a Japanese brokerage.
“We still need to keep an eye on Italy and Spain. But in the very near-term, a lot of bad positions seem to have already been unwound,” the trader said.