• Euro may fall on German factory orders
• The largest economy in the euro area is vulnerable
• If Germany goes into recession, what?

EUR / USD may fall as Germany is preparing to disclose factory order data. Forecasts are at 0,3% compared to previous ones at -1.0%. The French economy has blurred recently, while Italy has fallen into a technical recession, and the largest economy in the eurozone has narrowly avoided the fate of the latter.

The impact of trade wars on the Chinese economy had a negative impact on Germany's growth. The largest economy in the euro area has only slightly left the recession recently when France is falling apart and Italy is falling into recession. The impact of trade wars on the Chinese economy has also influenced Germany's growth, e.g. Brexit causes uncertainty. The ECB recognizes the seriousness of the situation and the potential obstacles facing the EU in 2019.

Overall growth is expected to slow down and Germany - on which many countries depend - is prone to recession. This opens the way to a potentially catastrophic eurozone crisis as the EU prepares for the European Parliament elections in spring. Under these circumstances, German data can be monitored more closely than before as traders try to gauge the outlook for Europe. In the near future the EUR / USD exchange rate may fall after re-testing 1.1478 and may approach the level of 1.1358 if the data fail. Conversely, if the report is better than expected, the pair may strive for 1,1435. For now, the EUR / USD exchange rate is around 1.1406, probably waiting for the result of the upcoming data.