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When are the German Retail Sales and how could they affect EUR/USD?

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When are the German Retail Sales and how could they affect EUR/USD?

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update 2025.08.29 13:51
When are the German Retail Sales and how could they affect EUR/USD?

update 2025.08.29 13:51

The German Retail Sales Overview

Germany's Retail Sales are expected to rise by 2.6% year-over-year (YoY) in July, in comparison to the previous increase of 4.9%. Meanwhile, the monthly Retail Sales are forecast to see a decline of 0.4% in July, following a previous increase of 1.0%.

How could the German Retail Sales affect EUR/USD?

EUR/USD is halting its three-day winning streak, remaining within the 1.1700-1.1650 range ahead of the German Retail Sales. The pair stays under selling pressure as the US Dollar rebounds on profit-taking ahead of the United States (US) Personal Consumption Expenditures (PCE) Price Index release for July.

A stronger-than-expected rise in German consumer spending could support the Euro (EUR), pushing the EUR/USD pair toward the 1.1700 round level. A breakout above this level would strengthen the short-term price momentum, opening the door for a test of the monthly high at 1.1742. However, a weaker print may put downward pressure on the pair to test the initial support at the 50-day Exponential Moving Average (EMA) of 1.1607. Further declines could undermine medium-term momentum and drive the pair toward the 1.1500 psychological mark.

German economy FAQs

The German economy has a significant impact on the Euro due to its status as the largest economy within the Eurozone. Germany's economic performance, its GDP, employment, and inflation, can greatly influence the overall stability and confidence in the Euro. As Germany's economy strengthens, it can bolster the Euro's value, while the opposite is true if it weakens. Overall, the German economy plays a crucial role in shaping the Euro's strength and perception in global markets.

Germany is the largest economy in the Eurozone and therefore an influential actor in the region. During the Eurozone sovereign debt crisis in 2009-12, Germany was pivotal in setting up various stability funds to bail out debtor countries. It took a leadership role in the implementation of the 'Fiscal Compact' following the crisis - a set of more stringent rules to manage member states' finances and punish 'debt sinners'. Germany spearheaded a culture of 'Financial Stability' and the German economic model has been widely used as a blueprint for economic growth by fellow Eurozone members.

Bunds are bonds issued by the German government. Like all bonds they pay holders a regular interest payment, or coupon, followed by the full value of the loan, or principal, at maturity. Because Germany has the largest economy in the Eurozone, Bunds are used as a benchmark for other European government bonds. Long-term Bunds are viewed as a solid, risk-free investment as they are backed by the full faith and credit of the German nation. For this reason they are treated as a safe-haven by investors - gaining in value in times of crisis, whilst falling during periods of prosperity.

German Bund Yields measure the annual return an investor can expect from holding German government bonds, or Bunds. Like other bonds, Bunds pay holders interest at regular intervals, called the 'coupon', followed by the full value of the bond at maturity. Whilst the coupon is fixed, the Yield varies as it takes into account changes in the bond's price, and it is therefore considered a more accurate reflection of return. A decline in the bund's price raises the coupon as a percentage of the loan, resulting in a higher Yield and vice versa for a rise. This explains why Bund Yields move inversely to prices.

The Bundesbank is the central bank of Germany. It plays a key role in implementing monetary policy within Germany, and central banks in the region more broadly. Its goal is price stability, or keeping inflation low and predictable. It is responsible for ensuring the smooth operation of payment systems in Germany and participates in the oversight of financial institutions. The Bundesbank has a reputation for being conservative, prioritizing the fight against inflation over economic growth. It has been influential in the setup and policy of the European Central Bank (ECB).


Date

Created

 : 2025.08.29

Update

Last updated

 : 2025.08.29

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