020 7898 0500With little data released from the Eurozone throughout this week, the fate of the euro has largely been in the hands of its main counterparties.
Following on from negative UK inflation data on Tuesday, the Euro rallied to an eight-month high against sterling. A similar story unravelled against the US dollar, where a raft of poor US data saw the euro continually gain in the early parts of the week. However, the positive start to the week was somewhat dampened by Ewald Nowotny, a Member of the European Central Bank (ECB), who yesterday suggested an extension to the central bank’s current quantitative easing (QE) programme is on the cards. As a result, the euro retraced to levels seen at the beginning of October.
With inflation data being key in regard to the ECB’s stance on QE, this morning will be very telling morning for the euro. We see Consumer Price Index data – an indicator of inflation, this is expected to come out at -0.1%. An unexpected figure could trigger additional members to voice their perspectives, and cause movement in euro markets.
