EUR/USD Holds Steady Around 1.0550 Ahead of German GDP vs CPI DT
EUR/USD remained stable around the 1.0550 mark on Monday morning in Europe. Traders are cautious, refraining from making significant moves on the Euro ahead of crucial inflation and GDP data from Germany. Ongoing political tensions also add to market apprehension.
The EUR/USD pair started the week with minor losses in the early Asian trading hours. Amid a busy week of economic releases, traders await signals from Germany's growth figures as well as inflation and GDP data from the Eurozone before the highly anticipated Federal Reserve (Fed) meeting on Wednesday. The major currency pair is currently trading around 1.0557, down 0.07% for the day.
Market predictions indicate a further deterioration in European economic conditions. Germany's Gross Domestic Product (GDP) is anticipated to decrease by 0.3% in the quarter, compared to a 0.2% increase in the previous reading. Eurozone GDP is forecasted to drop to 0.2% from the earlier 0.5%. Lastly, Eurozone HICP is expected to decrease from 4.3% to 3.4% in October.
On the US front, the Federal Reserve is expected to maintain interest rates at the end of its two-day meeting on Wednesday. Last month, Fed Chairman Jerome Powell stated that inflation remained excessively high, raising expectations of possible additional rate hikes later this year. This implies that higher long-term interest rates in the US could bolster the USD and act as a resistance for the EUR/USD pair.
In terms of data, the US Core Personal Consumption Expenditures (PCE) Price Index reached 3.7% YoY in September, slightly lower than the previous 3.8%. The monthly figure increased to 0.3% from 0.1% in the previous reading. Additionally, September's headline PCE Price Index was in line with expectations at 3.4%.
Market participants will closely monitor Germany's Gross Domestic Product (GDP) for the third quarter (Q3). Preliminary Consumer Price Index (CPI) data from Spain for October and Germany's CPI will follow later on Monday. Later in the week, Germany's Retail Sales, Eurozone GDP, and Eurozone inflation figures will be released on Tuesday. The focal point of the week will be the Fed's monetary policy meeting on Wednesday. This event could bring market volatility and provide a clear direction for the EUR/USD pair.
The EUR/USD pair started the week with minor losses in the early Asian trading hours. Amid a busy week of economic releases, traders await signals from Germany's growth figures as well as inflation and GDP data from the Eurozone before the highly anticipated Federal Reserve (Fed) meeting on Wednesday. The major currency pair is currently trading around 1.0557, down 0.07% for the day.
Market predictions indicate a further deterioration in European economic conditions. Germany's Gross Domestic Product (GDP) is anticipated to decrease by 0.3% in the quarter, compared to a 0.2% increase in the previous reading. Eurozone GDP is forecasted to drop to 0.2% from the earlier 0.5%. Lastly, Eurozone HICP is expected to decrease from 4.3% to 3.4% in October.
On the US front, the Federal Reserve is expected to maintain interest rates at the end of its two-day meeting on Wednesday. Last month, Fed Chairman Jerome Powell stated that inflation remained excessively high, raising expectations of possible additional rate hikes later this year. This implies that higher long-term interest rates in the US could bolster the USD and act as a resistance for the EUR/USD pair.
In terms of data, the US Core Personal Consumption Expenditures (PCE) Price Index reached 3.7% YoY in September, slightly lower than the previous 3.8%. The monthly figure increased to 0.3% from 0.1% in the previous reading. Additionally, September's headline PCE Price Index was in line with expectations at 3.4%.
Market participants will closely monitor Germany's Gross Domestic Product (GDP) for the third quarter (Q3). Preliminary Consumer Price Index (CPI) data from Spain for October and Germany's CPI will follow later on Monday. Later in the week, Germany's Retail Sales, Eurozone GDP, and Eurozone inflation figures will be released on Tuesday. The focal point of the week will be the Fed's monetary policy meeting on Wednesday. This event could bring market volatility and provide a clear direction for the EUR/USD pair.
