The final Euro inflation figures are set to be overshadowed by the US CPI inflation print this week. Fed Chair Jerome Powell is scheduled to speak on Tuesday, adding to market anticipation. US consumer inflation expectations have risen again, making the path to rate cuts more complicated.
On Monday, EUR/USD saw minimal upside movement, hovering around 1.0770 before struggling to break above the 1.0800 level. German final Harmonized Index of Consumer Prices (HICP) inflation figures are expected during the European market session, but are unlikely to cause much volatility unless there are significant adjustments compared to preliminary figures. European Gross Domestic Product (GDP) growth for the first quarter is also anticipated to remain steady at 0.3%.
US consumer inflation expectations for April have increased, with consumers expecting inflation to accelerate to 3.3% over the next year, up from 3.0% in March. US Producer Price Index (PPI) inflation numbers are due during Tuesday’s US market session, with expectations of a slight uptick to 0.3% MoM compared to the previous month.
In terms of technical analysis, EUR/USD remains at the high end after bouncing from the 200-hour Exponential Moving Average (EMA) near 1.0730. However, bullish potential is limited by a supply zone above 1.0800. Daily candlesticks show the pair facing strong technical resistance at the 200-day EMA at 1.0789, with a potential fall back to the last swing low near 1.0600 if bidders fail to push higher. A break above 1.0900 could signal further upside for the pair.
Overall, market focus remains on inflation figures and economic data releases, with EUR/USD trading within a narrow range awaiting further direction.