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The EUR/USD pair found an immediate bolstering factor around 1.0000 ahead of the key US CPI data expected on Thursday. US shares were subject to massive selloff transactions amid anxiety ahead of US midterm elections.
The Eurozone CPI is still seen at 3% in three years and 5.1% in the next 12 months. The EUR/USD pair has picked parity as immediate support in the early Tokyo session after a corrective move from around 1.0100. The asset sensed selling pressure as the market turned cautious ahead of the US Consumer Price Index (CPI) release.
S&P500 sensed an intense selloff amid headwinds of the US midterm elections results and upside risks from the inflationary pressures as they can move upwards despite expectations of a probable decline. Meanwhile, the US dollar index rebounded firmly to 110.50 amid an improvement in safe-haven’s appeal.
The 10-year US Treasury yields witnessed a steel fall below 4.10% as odds are favoring a rate hike of 50 basis points (bps) by the Federal Reserve (Fed) in its December monetary policy meeting.
Headline US CPI is seen lower at 8%, and the core inflation that excludes oil and food price growth would drop marginally to 6.5%.
On the Eurozone front, inflation rate is in the double-digit figure and is hurting the households’ sentiment. A survey conducted by the ECB of consumer expectations for inflation dictates that consumers still see inflation at 3% in three years and 5.1% over the next 12 months.
