EUR/USD: No reason to reconsider expectations of another rate hike by the ECB, supporting Euro – Commerzbank

FXStreet Insights Team FXStreet

Eurozone inflation figures did not yet provide the doves on the ECB's Governing Council with any resounding arguments for an end to rate hikes. Therefore, economists at Commerzbank expect the Euro to remain underpinned.

Euro unaffected by stubbornly high core inflation rate

Eurozone inflation data did not provide any new momentum for the Euro. Even though core inflation did not ease as expected but remained at 5.5% in July the result is within the range of normal margin of error.

Monday’s data certainly didn't convince the hawks on the ECB board that the hiking cycle is over.

Our ECB experts continue to believe that the market's expectations of another rate hike are likely to be disappointed, but for now, there is no reason for the market to reconsider this expectation. This supports the Euro.

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FXStreet Insights Team

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