EUR/USD: Easing inflation data in the Eurozone to dampen the Euro – Commerzbank

The ECB continues to attract attention with hawkish comments. But November inflation figures in the Eurozone could dampen rate fantasies on easing inflation, economists at Commerzbank report.

Eurozone inflation expected to have eased slightly in November

“The recently hawkish ECB comments have fuelled speculation about a 75 bps step. If the inflation data today and above all tomorrow was to surprise on the upside, speculation is likely to increase further.”

“After EUR/USD made another attempt towards 1.05 yesterday but then failed in the end, a surprise on the upside on the inflation front might finally push the pair above this mark.”

“We, just like the majority of analysts polled by Bloomberg, expect Eurozone inflation to have eased slightly in November. If today’s data from Germany was to point in that direction, rate fantasies on the market and thus the Euro might suffer a dampener, with downside pressure on EUR likely to be limited though thanks to hawkish ECB comments and the still high inflation rate.”