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Preliminary eurozone CPI data for May will likely show depressed inflation. Without shocking figures, the EUR/USD pair has room to rise, in the opinion of FXStreet’s analyst Yohay Elam.

Key quotes

“Petrol will likely put pressure on CPI, with expectations standing at 0.2%. A drop to 0% – stagnation – or even outright deflation, cannot be ruled out.”

“Core CPI is expected to remain stable at 0.9%, which is below pre-coronavirus levels, but within the ranges seen in recent years.”

“The euro is benefitting from several positive developments and only a dual drop of headline CPI below 0% and a fall in underlying inflation to 0.7% or lower would weigh on the common currency. In any other case, EUR/USD would likely trade choppily in range or even rise, especially if Core CPI rises to the round number of 1% or even exceeds it.”