How will the ECB react to CPI data?
City Index August 29, 2014 2:14 PM
<p>Eurozone inflation data is the one to watch today after a shaky build up to it this week. The range for the week so far […]</p>
Eurozone inflation data is the one to watch today after a shaky build up to it this week. The range for the week so far has been between 1.3151 and 1.3220, with a chance that we could break out of this today either way. With low expectations on eurozone inflation, around a 0.3% a drop from 0.4%, this could spur the ECB to act as widely expected. This could be in the form of a rate cut as early as next week, or the more talked-about QE they may add. So it’s all based around this data today, expected to be a volatile release. Just to note the German CPI yesterday came in as expected and there was no reaction in the market. M3 money supply was up to 1.8% from 1.5%, showing signs of improving cash circulation.
USD/JPY has struggled to get back above to its highs above the 104 level. This is down to the safe haven bid coming back into play, with Ukraine tensions still a major part in this pair.
Supports 1.3155 1.3127 1.3094 | Resistance 1.3216 1.3249 1.3277
Supports 103.55 103.38 103.22 | Resistance 103.88 104.04 104.21
Supports 1.6565 1.6543 1.6519 | Resistance 1.6611 1.6635 1.6658