Heads up: German Q2 preliminary GDP report due soon – ForexLive

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The release is scheduled for 0600 GMT

Germany GDP
ForexLive

The expectation is for the German economy to contract by 0.1% q/q after the brief reprieve seen in Q1 this year. The real worry for Germany is that the current economic slump may be more profound than anticipated.

I reckon any print of -0.3% q/q or worse (though unlikely) will set off alarm bells and give the euro a nudge lower as it could be a prelude to a technical recession.

Meanwhile, a better print – one avoiding a contraction – may let euro bulls breathe easier and potentially see the euro inch a tiny bit higher (I reckon no more than 10-15 pips).

Though, with global economic conditions continuing down this path, it is but a matter of time before Germany comes face-to-face with the reality of a technical recession. That sentiment should limit any optimism or upside from the report here.

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