FXStreet (Barcelona) - Marc Chandler, Global Head of Currency Strategy at Brown Brothers Harriman noted that on the eve of the ECB meeting, euro zone data disappointed

Key Quotes

" First, German manufacturing orders fell 3.2% in June."

"It is the largest decline since September 2011. The consensus had forecast a 1.0% rise after a 1.6% decline in May."

"The year-over-year rate slumped to -2.4%, the first contraction since last May. The report warns that the euro area locomotive ended Q2 on a weak note, and that to the extent that orders are a leading indicator, suggests Q3 may be poor as well."

"The Bundesbank has already warned that the economy stalled in Q2. Foreign orders were off 4.1%."

"Some, including the German Economic Ministry, are linking this to sanctions on Russia. It is possible, but it strikes us as a bit unlikely to have much impact yet, though as the Ministry noted it could lead to a "clear reticence in orders" in the coming months."

"However, more attention should, arguably be given to the 10.4% decline in orders from the euro area. At the same time, it is not simply foreign demand, but domestic orders fell 1.9%."

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