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FXstreet.com (Barcelona) - Lee Hardman, FX Analyst at the Bank of Tokyo Mitsubishi UFJ notes that the release of the euro-zone CPI report for December will be in focus in the European trading session.

Key Quotes

“The report is expected to reveal a modest decline in the annual rate of headline inflation to 0.8% in December.”

“Absent a sharper than expected decline in inflation in today’s report, it appears likely that the ECB will leave its monetary policy stance unchanged at this week’s meeting. The leading PMI surveys are signalling that the economic recovery in the euro-zone has likely continued to strengthen gradually in Q4 2013.”

“Economic growth may even surprise to the upside in Spain where the services PMI increased by 2.7 point to 54.2 in December reaching its highest level since July 2007.”

“The trade-weighted euro is only modestly stronger since their last meeting on the 5th December which is unlikely draw specific concern from the ECB. We continue to expect the euro to remain relatively stable against the US dollar in the near-term.”
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