Summary:
- German prelim HICP Y/Y: +2.1% vs +2.1% exp
- Euro edging higher on the day
- EURUSD back near 1.17 handle
It’s a busy week ahead for economic releases, but today in comparison is relatively quiet with little of note due out this afternoon. The only real data of note is the latest German inflation figures, and in coming in inline with both the forecast and the prior they’ve failed to provide much of a market reaction. Specifically speaking the July preliminary HICP was +2.1% Y/Y - matching both the consensus forecast and the figures for June.
Eurozone CPI tomorrow will now be in focus after we’ve had a slightly softer Spanish reading today (+2.2% Y/Y vs 2.3%) and a German one that was inline.
As the largest economic force in the EU, German figures often hold a fair amount of weight and traders will likely have these in mind when the Eurozone area numbers are released at 10AM tomorrow morning. While inflation figures are often some of the most important data points for traders to look to, these batch of figures are unlikely to have as big an impact given that they come just a matter of days after last week’s ECB meeting.
The Euro is making some small gains on the day, but the move higher in EURUSD seems to be more down to weakness in the buck. Source: xStation
There wasn’t any major developments from Draghi and co last Thursday, although the decline seen in the EURUSD on the day was in fact the largest in a month - due in part to some strengthening of the US dollar. The pair is moving higher today, with the market once more approaching a falling trendline and possible upper bound of its recent consolidation phase.
EURUSD remains in a broader consolidation phase, as the market recovers from last Thursday’s declines. Source: xStation
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