Euro Firm Even as Inflation & Current Account Miss Expectations

The euro was firm against other most-traded currencies today despite rather weak domestic macroeconomic data released over the trading session. The currency has trimmed its gains versus the US dollar by now but otherwise remained strong.
Eurostat reported that the eurozone annual inflation rate was at 1.0% in July, down from 1.3% in June, according to the final estimate. Market participants were expecting the same reading as the preliminary 1.1%. The core inflation rate was at 0.9%, down from 1.1% in the previous month but matching the preliminary estimate and market expectations.
The European Central Bank reported that the current account surplus was at â‚¬18 billion in June compared with the â‚¬30 billion surplus in May. Ahead of the report, analysts had predicted an increase to â‚¬32 billion.
The currency remained undeterred by the negative data, though. Specialists speculated that today’s risk-on mentality of traders was the reason for that.
Going forward, the euro will likely react to the monetary policy meeting minutes released by the Federal Reserve and the ECB this week as well to the speech of Fed Chair Jerome Powell at the Jackson Hole symposium.
EUR/USD traded at 1.1097 as of 13:34 GMT today after opening at 1.1092 and rallying to the daily high of 1.1114. EUR/GBP gained from 0.9115 to 0.9156. EUR/AUD advanced from 1.6352 to 1.6387.

If you have any questions, comments, or opinions regarding the Euro, feel free to post them using the commentary form below.

Leave a Reply

Your email address will not be published. Required fields are marked *