• Forex
  • Investments
  • Loyalty program
  • Promotions
  • Analysis
  • Getting started
  • About us

This Week: Euro bulls hope for higher CPI prints

EURUSD has extended its year-to-date declines following Friday’s higher-than-expected US PCE Deflator data (the Federal Reserve’s favoured measure of inflation) which translated into broad-based US dollar strength.

Still, Euro bulls will be hoping to claw back some ground later this week:

Monday, February 27

  • EUR: Eurozone February economic confidence; ECB Chief Economist Philip Lane speech
  • GBP: Bank of England Deputy Governor Ben Broadbent speech

Tuesday, February 28

  • JPY: Japan January industrial production, retail sales
  • AUD: Australia January retail sales
  • CAD: Canada December GDP
  • USD: US February consumer confidence; Chicago Fed President Austan Goolsbee speech

Wednesday, March 1

  • AUD: Australia 4Q GDP
  • CNH: China February PMIs
  • EUR: Eurozone February manufacturing PMI (final)
  • GBP: UK February manufacturing PMI (final); BOE Governor Andrew Bailey speech
  • USD: US February ISM manufacturing

Thursday, March 2

  • EUR: Eurozone February CPI, ECB minutes, January unemployment
  • GBP: BOE Chief Economist Huw Pill speech
  • USD: US weekly jobless claims

Friday, March 3

  • JPY: Japan January unemployment; February Tokyo CPI
  • CNH: China February services PMI
  • EUR: Eurozone January PPI, February services PMI (final)


We get fresh inflation numbers out of the eurozone on Thursday with the headline reading expected to reveal a modest slowdown.

Here are the market forecasts for the February 2023 consumer price index for the Eurozone economy:

  • Year-on-year: 8.2% higher compared to February 2022 (lower than January’s 8.6% year-on-year gain)
  • Month-on-month: 0.5% compared to January 2023 (higher than January’s 0.2% contraction compared to December 2022)
  • Core year-on-year: 5.3% (matching January’s 5.3% year-on-year advance)


Note that the core print, which strips out volatile food and energy costs, was recently revised one-tenth higher to an all-time peak and is the key figure for policymakers.

Hence, if this week’s inflation data exceed the above-listed market forecasts, the Euro currency is expected to climb higher.

Euro gains are set to be predicated on bets that the European Central Bank will have to hike its benchmark rates higher than previously expected.

On that same day (Thursday, March 2nd), the minutes for the February ECB meeting are released and any chat from officials about the planned path for interest rates beyond March will be seized upon by markets.


Looking at the price charts …

The euro has lost support around the 38.2% Fibonacci level around 1.06 on the surging US dollar.

The next strong line of support may arrive around 1.04832 from the January 2023 cycle low. At the same time, euro bulls will be keeping their fingers crossed for a hotter-than-expected inflation print this week to try and send EURUSD clambering back above the 1.06 mark.

And from a technical perspective, EURUSD’s 14-day relative strength index (RSI) has fallen tantalisingly close to the 30 threshold which denotes “oversold” conditions.

Euro bulls will be hoping for a repeat of last year’s instances, whereby EURUSD enjoys a technical rebound when the RSI touches or submerges below that 30 mark.

Euro bulls hope for technical rebound



There's a better website for you

A new exciting website with services that better suit your location has recently launched!

Sign up here to collect your 30% Welcome Bonus.