It’s back to reality for the euro: the zone’s second and fourth largest economy released inflation numbers and they weren’t impressive. Can the final CPI read for September fall below the already weak numbers?
In the meantime, EUR/USD is certainly sliding. After having reached 1.2767, the pair is back below 1.27 ahead of the all important German business confidence.
France reported a drop of 0.4% in prices for Septmber, worse than 0.3% expected and erasing the 0.4% rise seen in August. Year over year, prices in France are rising only 0.4%.
Spain reported a rise of 0.2% in September m/m but a decline of 0.2% on the year, or 0.3% in the HICP (European standard harmonized).
The initial CPI read for September showed a rise of 0.3% y/y and 0.7% in core inflation. This was the first time that both figures reached their lower levels. They might be downgraded in the final read.
The big release today is the German ZEW business confidence, which is expected to barely hold on to a positive figure. See how to trade the ZEW figure with EUR/USD.
