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The EUR/USD pair considerably fell Friday, dropping below the 1.13 level as coronavirus infections in Europe are getting worse every day.
Rising inflation combined with a deteriorating pandemic and ultra-dovish ECB policy, in terms of tapering stimulus are among multi factors leading to a lockdown inflation spiral, eventually getting out of control.
Earlier in the session, data showed that German PPI inflation skyrocketed to 18.4% y-o-y, up from the previous reading at 14.2%. Monthly change rose to 3.8% from 2.3% in September.
Additionally, the French unemployment rate worsened to 8.1% from 8.0% previously, against expectations of improvement to 7.8%.
Traders paid attention to the ECB’s head Cristine Lagarde speech, who once again reiterated that the conditions to raise rates are very unlikely to be satisfied next year despite nearly 20% PPI inflation in Germany.
