European macro data surprises have dropped into negative territory for the first time in 3 months as the last 3 weeks have seen the biggest drop in 19 months. Of course, none of that matters, as EURJPY was bid all the way through the European day, lifting European stocks and the all-important Italian and Spanish bond markets. Markets were relatively thin still today but just as we have seen around the world (most specifically in Japan and the US recently) equity markets push on ahead despite the collapse in macro data - but we've seen this before a few times (and it did not end well)...
European macro data has plunged in the last 3 weeks...
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but EURUSD appears to expect European macro data to deteriorate even further relative to the US...
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but it appears the US and Europe have recoupled (remember its never a decoupling - it's a lead-lag relationship)...
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But it is stocks that remain aloof to macro reality - as they do around the world (but we saw this before in Q1 2011)...
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and today in Europe...everything is fine...
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Charts: Bloomberg