Will Wednesday’s CPI Impact EUR/USD?

The U. S. dollar was wavering between 93.90 and 94.10 in the New York session after data showed US producer prices increased solidly in October.

While this was indicating that high inflation could persist for a while amid tight supply chain difficulties related to the pandemic, there were no great shakes ahead of Wednesday’s key event in CPI.

The shared currency recovers from early daily losses close to 1.1600. US PPI index rose a tick more than expected, but investors are focused on Wednesday’s CPI readings.

The EUR/USD has been steady during the Tuesday’s trading, failing to extend its two-day rally, the pair is trading around 1.1590 in the last hour.

The EUR bounced off daily lows around 1.1570 during the day as US bond yields fell sharply during the New York session, acting as a wind for the USD. Gains could be capped as the US Dollar Index is recovering, closing to the 94 figure, losing 0.08% at 93.98.

The EUR/USD pair reaction was muted, although being a US inflation report, investors’ focus is on the consumer inflation readings.