Euro Recovers Slightly, But Remains Below $1.19 Level
The euro is showing a small recovery today. The euro/dollar pair increased by 0.27% and is trading at 1.1884. The US will publish data on the CPI today. Analysts expect consumer prices to grow to 2.5% on a year-over-year basis, up from 2.4% in March. Core inflation, which excludes food and fuel, is projected to climb 2.2%.
Core prices are viewed by the Federal Reserve as a better gauge of longer-term inflationary pressure because they exclude the volatile food and energy categories. A jump in inflation could be a sign that the Fed would have to raise interest rates more rapidly if it begins to run above its 2% target.
In its Economic Bulletin, the ECB pointed to some moderation in economic growth. Analysis of the latest economic data and the results of the survey indicates a slight slowdown in growth since the beginning of the year. This moderation can partly reflect a pullback from the high growth rates observed at the end of last year.
The risks associated with the prospects for the growth of the Eurozone remain generally balanced, but they are mainly related to global factors, including the threat of increased protectionism. As for inflation, policymakers are still confident that inflation will continue to move towards the inflation target of 2%. The ECB still expects interest rates to remain at their current levels for a long period of time.