xtreamforex Posted January 31 Author Share Posted January 31 Currency Pair of the Week: EUR/USD The pair started on a positive note thanks for Spain’s Harmonized CPI, which came in at +5.8 YoY vs 4.7% YoY expected and +5.5% YoY last. Today, Markets will get a look at CPI from France and Germany, ahead of the Eurozone January Preliminary CPI tomorrow. Expectations are for a print of the headline CPI to drop to 9% YoY from 9.2% YoY in December. The Core rate is expected to drop to 5.1% YoY from 5.2% YoY in December. Expectations are for 50bps rate hike, which would bring the key rate to 3.00%. Many members of the committee, including ECB President Christine Lagarde, have already indicated that a 50bps hike is a done deal. Anything different will disappoint the markets. But traders will be watching for signals that another 50 bps rate hike is in the cards for March. Last week, the US released one of the Fed’s favorite measures of inflation, the Core PCE Price Index. The print was 4.4% YoY, as expected, vs a prior reading of 4.7% YoY. Today, the US will release another important gauge of inflation which the Fed relies heavily on: The Q4 Employment Cost Index. Expectations are for an increase of 1.1% vs a Q3 reading of 1.2%. How will these prints affect the FOMC when it meets tomorrow ? The markets are already pricing in a 99% chance of a 25bps hike, which would bring the Fed Funds rate to 4.75%.Read More : Daily & Weekly Analysis On Xtreamforex Link to comment Share on other sites More sharing options...
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