EUR/USD eyes third straight monthly loss, focus on German CPI
|- EUR/USD is on track to report the third consecutive monthly loss.
- The pair may print fresh 2.5-year lows on a dismal German labor market and inflation data.
- Italian bond yields may spike, adding to bearish pressures around the EUR.
EUR/USD is currently trading at 1.0932, representing 0.50% losses on Sept. 1's opening price of 1.0990.
The currency pair is on track to post its third straight monthly loss, having dropped 2.58% and 0.79% in July and August, respectively.
Focus on German data
The German retail sales, due at 06:00 GMT, are expected to show the consumer spending jumped 3.3% year-on-year in August. Meanwhile, the labor data due at 07:55 GMT is expected to show the jobless rate remained unchanged at 5% in September.
The German Consumer Price Index (CPI) scheduled for release at 12:00 GMT is expected to show the cost of living ticked up by 1.9% month-on-month in September, having dropped 0.2% in August. The annualized figure is seen rising by 1.4%.
The common currency will likely print fresh multi-year lows in the European session if the German retail sales and jobs data disappoint expectations, validating the ECB's recent decision to restart bond purchases.
Apart from the German data, the common currency may also take cues from the Italian bond yields.
Italy’s economy minister suggested on Sunday that the country’s budget deficit would be set at around 2.2% of domestic output next year. That could put the nation at odds with the European Union. Italian bond yields, therefore, may rise, pushing the EUR lower.
Technical levels
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