EUR/USD advances ahead of EU CPI, US PCE inflation

On Thursday, the EUR/USD pair surged as the Dollar Index decreased. As rate rise cycles come to an end, analysts anticipate greater Euro depreciation. With important US and EU inflation numbers on Friday, the trading week will come to an end.

On Thursday, the EUR/USD reached an intraday high of 1.0580 before settling to end the US trading session down close to 0.10566. The US Dollar has risen across the board, with the US Dollar Index benefiting from a market-wide increase as risk sentiment dwindles in response to deteriorating economic data, rising Treasury yields, and worries about a recession.

Investors are preparing for a full data slate on Friday, starting with the European CPI numbers. It is anticipated that European inflation will moderately drop. with a predicted decrease in the September annualized CPI estimate from 5.3% to 4.8%.

A dovish European Central Bank is fully prepared to start looking for rate cuts if the economy continues to sour. Market forecasts are projecting a 0.5 percent reduction in the rate of price growth for Europe as the continent’s economy sways.

The US Personal Consumption Expenditure Price Index data will be released on Friday as well. The annualized rate for the same period is expected to edge down from 4.2% to 3.9%, while US PCE inflation is predicted to remain stable for the month of August at 0.2%. Both the EU and US inflation figures are generally predicted to move down, but Europe is the weak-side bet because price rise is predicted to sharply slow in the upcoming months.