Three things went well for the euro. First, at the Eurogroup meeting of euro zone finance ministers on May 11, Greece did not receive its usual lambasting. The closing statement included a reassurance that “We acknowledged that more time and effort are needed to bridge the gaps on the remaining open issues.” It by no means represented a climb-down by the hardliners in Brussels, Helsinki and Berlin but the comment was unlike previous readings of the riot act and suggested an easing of tensions.

The second helpful event was when Greece made its €750m repayment to the IMF on May 12. While it was only able to do so by drawing down some of the country’s reserves held at the IMF but the ruse kept Greece technically solvent. That continued solvency ensured that Greek commercial banks would remain eligible for emergency funding from the European Central Bank.

The following day brought more help to the euro in the shape of the gross domestic product figures for the first quarter. The 0.3% quarterly growth reported by Germany was a disappointment but the Italian and French readings were certainly not. Italy’s 0.3% expansion beat estimates and France’s 0.6% smashed them. The French economy grew by more in the first quarter than Germany, the UK and the United States.

The UK economic data also did their bit to keep investors happy with the pound. Industrial and manufacturing production both exceeded expectations and the employment figures showed acceleration in wages and a fall in unemployment.

It was the opposite story in the United States. There were not many top-tier US ecostats to guide investors and the few that did appear were unhelpful. The biggest disappointment was a 0.0% monthly increase in retail sales, which sent the dollar a cent and a half lower against the euro.

Coming up next week, Tuesday (May 19) brings the Euroland and UK inflation data and the euro zone business confidence readings. On Thursday (May 21) the provisional purchasing managers’ index readings from Euroland coincide with UK retail sales and on Friday the figures for UK public sector borrowing and US inflation come out. If the States cannot deliver some more positive economic data the euro will be likely to maintain the upper hand.

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Katherine Woods, Moneycorp