Forex Trading News: Eurozone Industrial Orders lower than expected

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Euro zone industrial new orders gave a lower than expected reading for the month of February, but January orders were revised upwards.

The European Union statistics office Eurostat reported that industrial new orders in the 17 Eurozone countries increased by 0.9 percent month-on-month for a 21.3 percent year-over-year gain. The Reuters poll had an expected 1.0 percent monthly increase and a 21.8 percent annual rise.

Eurostat also revised upwards the January growth in orders from an initial 0.1 percent to 1.2 percent month-on-month, and to 21.9 percent year-on-year from a previous 20.9 percent.

Industrial new orders is an important indicator since it translates into industrial production, which is a key element of gross domestic product (GDP) growth.

Not including volatile orders for ships, planes and trains, industrial orders rose 20.8 percent higher compared to a year earlier and 0.6 percent on the month.

The breakdown of the orders showed demand for capital goods was strong — 3.3 percent higher than in January and 25.7 percent higher than in February 2010.

Demand for durable consumer goods also grew on the month, rising by 1.9 percent, but the increase was modest in year-on-year terms at 7 percent.

Any positive change is good for the currency, and vice versa. Upon release of the news, Euro dipped slightly. At news time, EURUSD was at 1.4689 and dropped down to 1.4669 within 30 minutes.