Prices in the euro-zone dropped 0.1% y/y in September – outright deflation. The unemployment rate also disappointed with a rise up to 11%. Core inflation met expectations with 0.9%, unchanged from the previous month.
EUR/USD is holding its ground so far, as this was mostly priced in due to the preliminary release.
The euro-zone was officially expected to report a headline inflation rate of 0% y/y in September after +0.1% in August. However, weaker data from Germany and Spain implied a negative figure. Core CPI was expected to remain unchanged at +0.9% y/y.
EUR/USD traded around 1.1220 towards the publication.
This release feeds into the ECB decision in mid October.
More:
- EUR/USD: Sell At Trendline Resistance – Credit Suisse
- Traders Don’t Be Surprised, The EUR Will Rise – HSBC
