In the midst of the tariff saga between the USA.-Canade-Mexico, which was the main promoter of the EUR/USD yesterday, the preliminary estimates of the IPC of the euro zone for January were slightly higher than expected. The underlying measure remained unchanged by 2.7% (expected 2.6%) for the fifth consecutive month and the holder increased for the fourth consecutive month, challenging the quite optimistic position of the ECB again on the deflation, says the division analyst of Ing Francesco Pesole Pesole .
The USA-China commercial agreement will take the EUR/USD about 1,040
“This means that risks are still significant for inflation, but we continue to trust that the trajectory remains deflation for the rest of the year. We still hope that the rates will be reduced at least 2.0% in the euro zone. The feeling In the euro zone it has improved thanks to the expectations that an agreement can be reached and avoid protectionism.
“If part of Trump’s motive to delay tariffs to the residents of the USA You can afford to play in the long term and perhaps keep them in place for a prolonged period, causing the EU to feel some ‘pain’ before reaching an agreement. , where an agreement is possibly faster to achieve as we saw yesterday, but with commercial imbalances, which often require longer negotiations. “
“With all this in mind, we are something skeptical that the euro is intended for a great rebound. Trump has already suggested that the EU is the following in the list of tariffs, and the markets will probably find better value in buying the falls in the Currencies that have passed the peak of protectionism against the euro, which must still face the worst of it. levels. “
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
