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Germany’s No. 1 think tank business climate ticked up to 109.9 points. Early expectations stood on a drop from 109.8 to 1.09.6.

EUR/USD leaps above 1.3165 following the publication – this line capped it yesterday.

The IFO’s Current Assessment for April also surprised by rising to 117.5 from 117.4 instead of sliding to 117 points.  IFO Expectations remained unchanged at 102.7, better than a predicted slide.

EUR/USD went as high as 1.3179 but couldn’t hold on to gains. A false break?

For more on the common currency, see the EUR/USD forecast.

High Spanish and Italian bond yields are weighing on the pair and limiting any rally that comes from positive German data. Also another important institute, ZEW, published an upbeat report earlier in the week.

German strength and peripheral weakness keep the pair balanced.

Spanish 10 year bond yields are ticking up to 5.98%, just shy of the magical 6% line. Italian 10 bond yields are up over 1% to 5.68%. Italy wishes to distance itself from Spain, using a lot of PR more than real actions.

Money continues flowing to Germany. As long as money doesn’t flow out of the zone, the euro seems stable.