- EUR/USD loses further momentum below 1.1900/
- German flash CPI came in at 0.4% MoM, 2.3% YoY in June.
- CB’s Consumer Confidence comes up next in the calendar.
The sentiment around the European currency remains depressed and EUR/USD sinks further into the negative ground, reaching at the same time new multi-day lows in the 1.1880/75 band.
EUR/USD accelerates the downside after breaking below 1.1900 the figure, as fresh oxygen revives the buying interest around the greenback.
No news from the bond markets, where US yields remain apathetic around 1.50%, while the German 10-year Bund shows some signs of life in the -0.16%.
Earlier in the euro calendar, advanced inflation figures in Germany now show the CPI rising 0.5% inter-month in June and 2.3% over the last twelve months. Later, investors are expected to follow Chairwoman Lagarde, as she speaks in Brussels.
Across the pond, the FHFA’s House Price Index rose 15.7% YoY in April and the S&P/Case-Shiller Index rose 14.9% YoY in the same period. Later in the US data space, the Conference Board will publish its Consumer Confidence gauge for the current month.
Sellers seem to have regained the upper hand and drag EUR/USD back to the vicinity of the 1.1900 key support. In the meantime, price action in spot is expected to monitor the dollar dynamics, particularly following the latest FOMC gathering, prospects of higher inflation and potential tapering before anticipated. Further out, support for the European currency comes in the form of auspicious results from fundamentals in the bloc coupled with higher morale, prospects of a strong rebound in the economic activity and the investors’ appetite for riskier assets.
Key events in the euro area this week: ECB’s Lagarde (Tuesday) – German labour market report, flash EMU CPI (Wednesday) – German Retail Sales, Final Manufacturing PMIs in the euro area, EMU Unemployment Rate, ECB’s Lagarde.
So far, spot is losing 0.26% at 1.1891 and a break below 1.1847 (monthly low Jun.18) would target 1.1835 (low Mar.9) and route to 1.1704 (2021 low Mar.31). On the other hand, the next resistance emerges at 1.1994 (200-day SMA) followed by 1.2026 (100-day SMA) and finally 1.2064 (38.2% Fibo retracement of the November-January rally).
