EUR/USD to hover around 1.0840 today before pushing 1.0900 – ING

Preliminary March inflation readings in Spain and Germany will be closely watched today. Regarding EUR/USD, economists at ING expect the pair to hover around 1.0840.

First CPI readings in focus

“The German figures will obviously draw greater interest, and consensus expectations are for a deceleration from 8.7% to 7.3% in the headline rate. Spanish numbers did trigger some market shake-up recently. Expectations are for a flat core rate at 7.6%, but a sharp deceleration in headline inflation from 6.0% to 3.7%.”

“With the European Central Bank explicitly data-dependent despite an implicit hawkish bias, this week’s inflation figures are set to be an important driver of the market’s rate expectations.”

“The EUR/USD rally took a break around 1.0840 and we could see it hover around those levels today, but we still favour a break above 1.0900 and ultimately a test of 1.1000 in the near term.”

See – EU HICP Preview: Forecasts from seven major banks, headline inflation falls sharply, but core remains high