Talking Points
- EUR/USD looking to re-coup recent losses.
- Will expectation beating inflation data allow ECB President Mario Draghi some wiggle room at next week’s meeting?
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EUR/USD moved slightly higher on Thursday after the latest Euro-Zone inflation readings came in higher than expected. According to Eurostat preliminary readings, core inflation remained unchanged in August at 1.3%, beating expectations of 1.2%, while the annual reading rose to 1.5%, beating forecasts of 1.4% and July’s 1.3%.
ECB President Mario Draghi will breathe a sigh of relief, at least in the short-term, at the latest move higher in prices and will likely point to this at next week’s monetary policy meeting. Draghi has remained firm that there must be a sustained improvement in inflation in the Euro-Zone before he moves to tighten monetary policy. Expectations have been building in the last few weeks that Draghi will use the September meeting to announce a framework of when the central bank will begin to pare back its EUR60 billion a month quantitative easing program.
See the latest EUR/USD by technical analyst James Stanley here.
Chart: EURUSD Thirty Minute Timeframe (August 28 - 31, 2017)
Ahead of next week’s meeting, this Friday’s non-farm payroll numbers will be closely watched, especially after Wednesday’s expectation busting ADP jobs report.
Join us for live roundtable coverage of the NFP report Friday from 12:15 GMT.
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--- Written by Nick Cawley, Analyst
To contact Nick, email him at nicholas.cawley@ig.com
Follow Nick on Twitter @nickcawley1
