EUR/USD: Pair holds near 1.18 as Euro inflation eyed – Danske Bank

FXStreet Insights Team FXStreet

Danske Bank’s Danske Research Team notes that EUR/USD is trading close to 1.18 as markets await key Euro area inflation data. The bank expects Euro area HICP inflation to edge up slightly to 1.73% year-on-year, with core inflation steady at 2.2%. Softer preliminary inflation prints from France, Spain and Germany could add downward pressure on Euro rates.

Euro inflation expectations support stability

"In the euro area, February's flash inflation data from France, Germany, and Spain will give important hints ahead of next week's euro area inflation release. We expect euro area HICP inflation to rise marginally from 1.69% y/y to 1.73% y/y, remaining at 1.7% y/y when rounded. Core inflation is expected to remain at 2.2% y/y."

"Core inflation is expected to remain at 2.2% y/y. Energy inflation is expected to rise due to lagged effects of January's energy price and higher fuel prices in February, which is the main reason we expect a small rise in the headline at the second decimal."

"Monthly momentum in services inflation will be crucial, given its notable weakness in January."

"EUR/USD continues to trade near the 1.18 level, while EUR/SEK remains below 10.70."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)

Author

FXStreet Insights Team

FXStreet

The FXStreet Insights Team is a group of journalists that handpicks selected market observations published by renowned experts. The content includes notes by commercial as well as additional insights by internal and external analysts.

AUD/USD bulls regain control above 0.6950 amid USD retreat

AUD/USD regains traction and extends the previous day's bounce from the weekly low, aiming for 0.7000 in Asia on Friday. The overnight pullback in US bond yields keeps the US Dollar below an 18-month high, which in turn offers some support to the pair. Meanwhile, hawkish RBA expectations also keep the major underpinned.

USD/JPY holds gains near 158.00 after Japan's weak Household Spending data

USD/JPY clings to gains around 158.00 after data showed on Friday that Japan's Household Spending fell for the ninth straight month, undermining the Japanese Yen. Meanwhile, the US Dollar remains depressed as the overnight fall in US bond yields counters a hawkish Fed and geopolitical uncertainties, could cap any downside in the pair.

Gold remains range-bound below $4,200

Gold has given up some ground after an initial bullish attempt to reach weekly highs, returning to below the $4,200 mark per troy ounce on Friday. The US Dollar’s strong upside momentum, combined with rising US Treasury yields across the curve, seems to keep further gains in the yellow metal under scrutiny.

Has Bitcoin really escaped the macro forces it was built to fight?

Over 17 years ago, Satoshi Nakamoto designed Bitcoin (BTC) on the back of a global financial crisis as an alternative to the global monetary system outside the control of central banks, governments and traditional intermediaries. This raises a key question: has Bitcoin really become independent of the macroeconomic forces it was built to challenge?

The Euro is not the sick man of Europe. France's bond market is

EUR/USD remains under pressure, near the 17-month low of 1.1161 reached on Monday. The pair has lost more than 7% since its yearly peak, as concerns over France's public finances increasingly weigh on the single currency. But behind the weakness of the Euro (EUR), the problem does not necessarily lie with the European economy as a whole.