When is German prelim Q4 GDP and how could affect EUR/USD?

German prelim Q4 GDP Overview

Preliminary reading of the fourth quarter German GDP is due later today at 7GMT. The consensus amongst traders expect the bloc’s economic power house to expand 0.5% inter-quarter in Q4 and 1.7% YoY vs. previous readings at 0.2% and 1.5%, respectively.

Deviation impact on EUR/USD

Readers can find FX Street's proprietary deviation impact map of the event below. As observed the reaction is likely to remain confined between 5 and 25 pips in deviations up to 3.5 to -2.5, although in some cases, if notable enough, a deviation can fuel movements of up to 35 pips.

 How could affect EUR/USD?

On a better GDP print, we could see a fresh bout of buying interest around the euro, pushing the EUR/USD pair towards 1.07 handle. However, if the readings disappoint, the rate could drop back towards multi-week lows near 1.0580/70 region.

Key notes

EUR/USD closed below 50-DMA for the first time in a month

The German economy is seen expanding 1.7% y/y in Q4. Meanwhile, Eurozone GDP is seen unchanged at 0.5% q/q. Zew survey is expected to show a mild improvement in the current situation index and mild deterioration in the economic sentiment index.

About German prelim Q4 GDP

German Preliminary GDP, which is released every quarter, is a measurement of the production and growth of the economy. Analysts consider GDP one the most important indicators of economic activity. A reading which is better than the market forecast is bullish for the euro.