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  • Center-left SPD party prevents far-right win in regional election

  • Eurozone’s flash PMIs press EURUSD below 1.1100

 

Olaf Scholz’s centre-left Social Democratic Party (SPD) escaped a defeat by a small margin of 1-2% against the far-right AfD during Sunday’s regional election in Brandenburg.

The state has been led by SPD since Germany’s reunification in 1990 and is a hometown to the German chancellor, who has been suffering plummeting opinion polls and anxiety within his coalition government, especially after the AfD’s landmark victory in Thuringia and Saxony earlier this month.

The leading party might have just avoided a new drama and perhaps its new stricter migration stance might bring some calm to Eurosceptic voters, though political jitters could persist ahead of the 2025 General election given the complicated wars in Ukraine and in the Middle-East.

In the meantime, the negative reaction to the eurozone flash PMI figures showed that economic stability is currently a more sensitive topic. Investors trimmed aggressively the latest rebound in EURUSD and squeezed the price as low as 1.1082 after the composite index dropped unexpectedly in the contraction area for the first time since March. Perhaps if the price manages to close above 1.1100 today, there might be a recovery attempt.