The German GDP data for Q4 showing a contraction of 0.3% is concerning for the Eurozone as Germany is the largest economy in the region. This weaker than expected GDP growth could potentially have a negative impact on the Euro currency as investors may become more cautious about the economic outlook for the Eurozone.
In terms of monetary policy, the European Central Bank (ECB) may be prompted to take further action to stimulate the economy in response to the weaker GDP data. This could include potentially cutting interest rates further into negative territory or increasing their asset purchase program.
Overall, the negative GDP data for Germany in Q4 could lead to increased volatility in the Euro currency and potential changes in monetary policy by the ECB to support economic growth in the Eurozone.