EUR/USD treaded water on Wednesday, sticking close to 1.1200.
Final German inflation figures for April impressed nobody, as expected.
US PPI inflation is just around the corner on Thursday.
EUR/USD trimmed momentum sharply on Wednesday, sticking to a flat holding pattern near the 1.1200 handle despite an early pop in bids. European economic data has been largely a non-starter this week, as is typical. However, a one-two punch of key inflation data from the United States (US) has given plenty of traders something to chew on.
German final Harmonized Index of Consumer Prices (HICP) for April came in exactly as expected on Wednesday, and data on the US side was strictly mid-tier, giving markets some breathing space between this week’s Consumer Price Index (CPI) inflation data released on Tuesday, and Thursday’s upcoming Producer Price Index (PPI) inflation figures.
Core PPI inflation is anticipated to decrease to 3.1% YoY, down from 3.3%. While easing inflation pressures is positive, markets are becoming more concerned about tariff effects, which are expected to start influencing headline economic data beginning as soon as May.
EUR/USD price forecast
Markets have thus far failed to muscle EUR/USD back over the 1.1200 handle this week, falling just shy of the key technical level. However, despite limited upside, the Fiber is still holding above the 50-day Exponential Moving Average (EMA) near 1.1070. Bullish momentum remains absent from the daily candlesticks, but technical oscillators are rolling over sharply from oversold territory, hinting at the potential for a bullish extension.
EUR/USD daily chart
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