German ZEW Survey/ Eurozone Final CPIs Overview
The ZEW will release its German Economic Sentiment Index and the Current Situation Index at 0900 GMT in the EU session later today, reflecting institutional investors’ opinions for the next six months.
The headline Economic Sentiment Index is expected to drop further to -5.9 in June as against a -2.1-reading booked in the previous month. Meanwhile, the Current Situation Sub-Index is likely to arrive at 6.0 versus an 8.2 jump recorded in last month.
Alongside the German data release, the Eurostat will publish the Eurozone’s inflation final estimate for May. Consumer prices are seen arriving at 1.2% on a yearly basis, confirming the flash estimate while the core figures are seen unchanged at 0.8%.
On a monthly basis, the CPI data for May is expected to come in at 0.2% versus 0.7% previous.
How could they affect EUR/USD?
FXStreet ´s own Analyst, Haresh Menghani writes: “From a technical perspective, bearish traders are likely to wait for a sustained weakness below the 1.1200 temporary support – marking 61.8% Fibonacci retracement level of the 1.1107-1.1348 recent up-move, before positioning for any further depreciating move. A convincing breakthrough will suggest the resumption of the prior bearish trend and turn the pair vulnerable to accelerate the slide back towards challenging the 1.1100 round figure mark with some intermediate support near mid-1.1100s.”
“On the flip side, the 1.1250-55 area (38.2% Fibo. level) now becomes immediate strong resistance and is closely followed by 100-day SMA near the 1.1270 region, which if cleared decisively might negate the near-term bearish bias and prompt a near-term short-covering move,” Haresh adds.
Key Notes
Preview: Draghi’s speech at ECB Forum in Sintra
Eurozone: German ZEW and ECB’s Sintra conference in focus – TDS
EUR/USD: A rare fledgling EUR uptrend forming – BAML
About German ZEW
The Economic Sentiment published by the Zentrum für Europäische Wirtschaftsforschung measures the institutional investor sentiment, reflecting the difference between the share of investors that are optimistic and the share of analysts that are pessimistic. Generally speaking, an optimistic view is considered as positive (or bullish) for the EUR, whereas a pessimistic view is considered as negative (or bearish).
About Eurozone CPI
The Eurozone CPI released by the Eurostat captures the changes in the price of goods and services. The CPI is a significant way to measure changes in purchasing trends and inflation in the Euro Zone. Generally, a high reading anticipates a hawkish attitude which will be positive (or bullish) for the EUR, while a low reading is seen as negative (or bearish).
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