EUR flows: Supported by stronger IFO survey

A surprisingly strong German IFO index hasn’t had a notable market impact, but it may help sustain the more positive EUR tone seen so far this session.  The IFO business climate index was expected to decline, but in fact rose in April, contrary to the PMI seen yesterday. While the expectations index was slightly lower, the current conditions index edged higher, so at this stage at least, there is no obvious damage to the German economy from the US tariff increases. Some impact has to be expected, but it may be being balanced by the expectation of increased government spending on infrastructure and defence. The EUR ought to benefit on the crosses against the safe havens, with EUR/CHF in particular having potential to move back towards 0.95.