While markets are preparing themselves for Mario Draghi’s speech later today, in the interim they’re digesting the latest news from Eurostat which showed September CPI figures meeting analysts’ expectations. Eurostat reported that CPI hit 0.4% last month on a month-over-month basis, up from the 0.2% reported in August. Meanwhile core CPI, which strips out volatile components like energy and food, hit the expected 0.8%. That will undoubtedly offer some relief to Mario Draghi as he weighs in on the necessity for a continued ultra-loose monetary policy; however, analysts are betting that QE continues at least through March 2017.
As reported at 10:38 am (BST) in London, the EUR/USD was trading at $1.0992, up 0.23%; the pair has ranged from a low $1.095 to a peak of $1.10 in today’s session. The EUR/GBP was trading near flat at 0.9038 Pence, moving away from the low of 0.902 Pence.
Rate Hike Bets Rise in US
The US Dollar continues to gain some momentum after last Friday’s release of upbeat producer price figures and US retail sales. Analysts say that that points to a strengthening recovery and could help traders better gauge the Fed’s sentiment regarding the timing of its next rate hike. Thus far, markets are pricing in a September rate hike as having the greatest probability.