Eurozone: Stronger than expected preliminary April CPI numbers – BBH
|Analysts at BBH explain that the Eurozone reported stronger than expected preliminary April CPI numbers as the headline rose to 1.9% from 1.5%, and the core rate jumped to 1.2% from 0.7%.
Key Quotes
“The data appears to have been flattered by the calendar effect of Easter and trip packages, for example, are included in the core. It is the highest level since mid-2013. The CPI report followed news of a stronger gain in M3 than expected, and an improvement in lending to both households and non-financial businesses.”
“The euro has rallied toward the week's high. However, since the sharply higher opening on Monday after the first round of the French elections, the euro has chopped around the same one cent range of $1.0850-$1.0950. Recall the $1.0935 area corresponds to the 61.8% retracement of the euro's decline since the US election last November. And $1.0980 is the 50% retracement objective of the decline from last year's high near $1.1615. Large option strikes at $1.09 (1.8 bln euros) and $1.0950 (2.4 bln euros) roll-off later today.”
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