European focus: strong IFO supports EUR [E]

The EUR advanced against the USD after report showed IFO business confidence hike in Germany.
Current year shows EUR has lifted more than 8% against the dollar on speculations differential of rates reduction between ECB and FED.
A member of ECB Department Nicholas Garganas highlighted, that the economy expand can exceed forecasts of bank, so that rate hikes look natural.
«The rate will be lifted at the June meeting and will continue policy of quarterly rates elevation.». - suppose Adam Cole, RBC Capital Markets. «This will bring positive sentiment on EUR.».
Last months inflation in Eurozone made 2.4%. The market is priced that ECB will lift it’s key rate in June on 25 b.p. to 3.25% by the end of the year.
Economic expansion in E.U. accelerated in the 1Q. GDP grew on 0.6% compared to the previous quarter indicator showing 0.3%.
«It is quite probable, that ECB will raise it’s benchmark rate two more or three times more. It, certainly, direct bullish sentiment on EUR.». – says Gavin Friend, Commerzbank AG.
Asian currencies were pressed with sells after message that birds flue has spread in Indonesia. The Indonesian, Thailand and Singapore currencies fell as the WHO said the virus may have spread between seven family members in Sumatra.