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German CPI dropped from a rise of 1.4% to 1.3% on an annual basis. Month over month, prices fell by 0.6%. The German Consumer Price Index was expected to drop by 0.4% on a monthly basis, and rise 1.5% year over year. The HICP figure was expected to drop 0.6% MoM and rise 1.3% YoY. It remained unchanged at 1.2%. The numbers are the initial releases for January. There are little changes between the flash and final versions.

EUR-USD dropped towards the publication, trading at around 1.3585 and is now trading at around 1.3575.

Earlier figures released by a few key German states already showed inflation is falling and weighed on the euro.

Lower German and euro-zone inflation could result in a negative deposit rate in March.

1.3550 provides support, followed by 1.35. Resistance is around 1.3615. The next event coming up is the release of US GDP. See how to trade the US Advance GDP with EURUSD.