EURUSD: prediction before FOMC
In Europe, the eurozone is set to release its final inflation figures for August later in the session. These figures are expected to confirm that the Consumer Price Index (CPI) increased by 0.6% on a monthly basis, marking a substantial 5.3% rise on an annual basis.
This annual inflation rate remains well above the European Central Bank's medium-term target of 2%, which was the rationale behind the central bank's decision to raise interest rates last week. The ECB elevated its deposit rate to a record high of 4% during that recent policy meeting. However, the central bank also hinted at a potential pause in its rate-hiking cycle, as policymakers intend to carefully evaluate the impact of the series of interest rate increases on the region's economy.
Moreover, it's worth noting that core inflation, which excludes the influence of volatile energy and food prices, is anticipated to decrease slightly to 5.3% annually from the previous 5.5%.
This inflationary environment presents both challenges and opportunities for the Eurozone's economic outlook, and the ECB's decisions in the coming months will likely play a crucial role in shaping the region's monetary policy and economic stability.
This annual inflation rate remains well above the European Central Bank's medium-term target of 2%, which was the rationale behind the central bank's decision to raise interest rates last week. The ECB elevated its deposit rate to a record high of 4% during that recent policy meeting. However, the central bank also hinted at a potential pause in its rate-hiking cycle, as policymakers intend to carefully evaluate the impact of the series of interest rate increases on the region's economy.
Moreover, it's worth noting that core inflation, which excludes the influence of volatile energy and food prices, is anticipated to decrease slightly to 5.3% annually from the previous 5.5%.
This inflationary environment presents both challenges and opportunities for the Eurozone's economic outlook, and the ECB's decisions in the coming months will likely play a crucial role in shaping the region's monetary policy and economic stability.
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