Single Currency Remains Sloppy, German Preliminary CPI Next
The Euro/Dollar pair dropped 0.01% to close at 1.2308. Today’s key event is German Preliminary Consumer Price Index. Unemployment change fell 19K. The US is about to feature jobless claims and UoM Consumer Climate. Final Gross Domestic Product has been revised up to 2.9%. The greenback responded with rise.
Eurozone inflation remains at low levels, which is a concern for investors. Erkki Liikanen (Governing Council member and the governor of Finland's central bank) claimed that Eurozone’s underlying inflation might stay at low levels longer than anyone assumes. And the ECB should very careful in its policy decisions, Liikanen added. Even considering the fact that the Bank is trying to cope with the economic slack, inflation may no longer respond with increase, as it used to, he explains. Thus, the ECB is much likely to refrain from any policy tightening so far.