Euro trims declines against U.S. dollar after Spanish inflation surge
30 Jun 2022
EURUSD is trading down 0.10% at 1.0511
The euro steadied on Wednesday after falling to a six-day low, reacting to the release of conflicting inflation data in Germany and Spain that created a difficult backdrop for European Central Bank policymaking.
The European common single currency decline in early London trading after data showed June prices in the German state of North Rhine–Westphalia (NRW) had been 0.1% lower than in May.
But the euro trimmed those losses, flattening on the day, after data showed Spanish 12-month inflation had risen to 10.2% in June, up from 8.7% in May and surpassing 10% for the first time since April 1985.
“Clearly the strength of Spanish CPI inflation data has undone the pressure on the euro,” said Jane Foley, head of FX strategy at Rabobank in London. That came after the -0.1% drop in Germany’s NRW June CPI number led “the market to question the hawkishness of the ECB going forward,” she added.
Investors were watching for national inflation data for Germany due at 1200 GMT, as well as a panel at the ECB Forum in Sintra, Portugal, with three major central bankers speaking.
ECB President Christine Lagarde, U.S. Federal Reserve Chairman Jerome Powell and Bank of England Governor Andrew Bailey will speak at 1300 GMT.
On Tuesday, Lagarde offered no fresh insight on the path for European interest rates at the ECB’s annual forum.
On technical fronts EURUSD RSI stood at 59.12 and currently it is trading below all MA. So, SELL position can be taken with following target and stoploss:
TRADE SIGNAL – : EURUSD – SELL: 1.0510, TARGET: 1.0481, STOP LOSS : 1.0541