On Tuesday, EUR/USD saw a significant gain of over half a percent, driven by a decrease in US Dollar bids after US Producer Price Index (PPI) inflation numbers came in lower than expected. Traders are now eagerly awaiting the release of Eurozone Gross Domestic Product (GDP) growth figures and upcoming US Consumer Price Index (CPI) inflation data, which could further impact market sentiment.
Forex Today: US Inflation Data to Shape Rate Cut Expectations
The Eurozone GDP for the second quarter is anticipated to remain steady at 0.3% QoQ and 0.6% YoY. Any deviation from these numbers could lead to a shift in market sentiment, with a lower-than-expected growth rate potentially triggering a sell-off in Euro markets.
Meanwhile, US CPI inflation is forecasted to continue its downward trend in July, with core CPI expected to ease to 3.2% YoY and headline CPI to drop to 2.9% YoY. The recent decline in US inflation pressures has led to an increase in market expectations of a 50 basis point rate cut by the Federal Reserve in September.
EUR/USD Price Forecast and Technical Analysis
Despite the recent rally, EUR/USD is still struggling to break above the 1.10000 level. While bullish momentum is pushing prices higher in the short term, the pair faces resistance at the 200-day Exponential Moving Average (EMA) near 1.0820.
Euro FAQs: Key Facts About the Euro Currency
The Euro is the currency used by 20 European Union countries in the Eurozone and is the second most traded currency globally. The European Central Bank (ECB) in Frankfurt, Germany, manages monetary policy for the Eurozone and aims to maintain price stability through interest rate adjustments. Economic data releases, such as GDP, inflation, and trade balance figures, can significantly impact the value of the Euro.
Overall, the recent uptrend in EUR/USD is driven by weakening US Dollar strength and easing inflation pressures. Traders should closely monitor upcoming economic data releases and central bank decisions for potential trading opportunities. Remember, always consult with a financial advisor before making any investment decisions.