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In a CNBC interview held in Frankfurt on Thursday, Goldman Sachs Chief Financial Officer (CFO) Stephen Scherr expressed his concerns on the German economic slowdown.

Key Quotes:

Germany is in the “early days of a slowdown”.

Economic trends in Germany are a big issue.

Uncertainty partly stemming from US-China trade war.

Bond market reflecting sentiment that there’s anxiety about prospect of a recession.

Some banks’ concerns about aggressive monetary policy easing are “understandable”.

Yield curve inversion reflects anxiety.

This comes amid growing German recession risks after a sharp slowdown in Germany’s Industrial and Construction sector activity.  Meanwhile, the government expects economic growth to slow to 0.5% this year from 1.5% in the previous year.  

EUR/USD holds the upside on the 1.10 handle, but lacks follow-through amid German economic weakness and trade progress.