Event to pay attention to today:
15:30 EET. USD – Unemployment Claims
EURUSD:
The EUR/USD pair demonstrated volatility on Wednesday, testing the lower boundary for the majority of the intraday session before displaying an upward trend following investors’ attempts to mitigate the impact of an unanticipated rise in US Consumer Price Index (CPI) inflation.The US Producer Price Index (PPI) is scheduled for release on Thursday, with European economic data taking a secondary position this week.
The final Harmonised Index of Consumer Prices (HICP) data from Germany is scheduled for release on Thursday, but this non-preliminary data is not expected to cause significant volatility, as the figures are well forecast and already fully priced in.German core HICP inflation for the year to January is forecast to remain at 2.8%.
In contrast, the US consumer price index rose notably in January, with core CPI inflation rising to 3.0% year-on-year, slightly above the expected 2.9%. The most significant part of this increase came at the near tail end, where the monthly CPI was 0.5%. Interestingly, markets had expected core CPI for the month to come in at 0.3%, especially since the previous figure was 0.4%.
On Thursday, the US core PPI is expected to be a key focus, with median market forecasts indicating a modest decline to 3.3% year-on-year from 3.5%. However, Wednesday’s rise in inflation has led to some investor concern, raising questions about the depth and permanence of inflation in the US domestic economy.
Trading recommendation: EURUSD: BUY 1.0440, SL 1.0360, TP 1.0490
Origin: FreshForex
