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Spain digs deeper into deflation: -0.5%, worst since 2009

Spain, the euro-zone’s fourth largest economy, reported a year over year drop of 0.5% in prices, the worst since 2009. The previous read was a drop of 0.4%. This implies a weaker euro-zone CPI tomorrow. See how to trade the euro-zone CPI with EUR/USD. The event could be critical for the ECB decision.

EUR/USD seems unmoved by the figure, and is holding on to gains just above 1.32.

When looking back at recent history, we see Spanish  inflation floating around 0% since September 2013. It used to be higher beforehand, but this was a result of a heavy hike in VAT that came into effect back in September 2012, making the  following year’s numbers skewed to the upside.

On a positive note, Spain confirmed the GDP growth for Q2, which was quite strong and way ahead of the trend: +0.6% quarter on quarter and 1.2% year over year.

Germany contracted in Q2 and France remained unchanged. The  all-euro-zone figure remained unchanged.

The focus now shifts to German CPI numbers which are  gradually released by the various German states.

Yohay Elam

Yohay Elam

Yohay Elam: Founder, Writer and Editor I have been into forex trading for over 5 years, and I share the experience that I have and the knowledge that I've accumulated. After taking a short course about forex. Like many forex traders, I've earned a significant share of my knowledge the hard way. Macroeconomics, the impact of news on the ever-moving currency markets and trading psychology have always fascinated me. Before founding Forex Crunch, I've worked as a programmer in various hi-tech companies. I have a B. Sc. in Computer Science from Ben Gurion University. Given this background, forex software has a relatively bigger share in the posts.