US CPI Inflation And ECB Meeting Minutes Are In Focus This Week

US CPI Inflation And ECB Meeting Minutes Are In Focus This Week

The EURUSD pair jumped up after US Jobs Report was published last Friday. The Non-Farm Payrolls rose by 213K in June, which is higher than the consensus estimate for the creation of 200K jobs. The previous month’s reading of NFP was revised to 244K from the 223K registered initially. However, the unemployment rate unexpectedly rose from 3.8% to 4.0%. Average hourly earnings advanced 0.2% month-on-month in June, below expectations for it to repeat a 0.3% gain.

The US Dollar rally stopped after disappointing US GDP growth and Unemployment rate. Now, we will focus on the other major indicator of economic conditions that is US CPI inflation in the upcoming week.

The June's customer price index is expected to come out at 2.9%, higher than a previous number of 2.8%. On the other hand, Core CPI inflation is expected to rise to 2.3% from 2.2% a month earlier. Acceleration in headline inflation may prompt investors to price further rate hikes from Fed.

In the Eurozone, watch out for the ECB meeting minutes. The ECB kept interest rates unchanged at 0%, as expected at their last meeting. But, they signaled the end of QE. Net asset purchases will be reduced to €15 billion from Oct until the end of December 2018 and that net purchases will then end. However, rates will be unchanged till Summer 2019. The minutes may help forecasters model ECB’s upcoming decisions.

Additionally, The German Consumer Prices index will be announced next week and it is expected to stay at 2.1% in June as the same as the previous number. A higher than expected reading should be taken as positive for the euro.

09 Jul 18 (Mon)

06:22 am



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