Euro dollar macroeconomic overview
As anticipated, the Producer Price Index (PPI) data for April will be released during the day. It is expected to rise 0.3% month-on-month, compared to March’s 0.2% increase. A higher-than-expected rise in the index could strengthen the US dollar, putting downward pressure on the euro-dollar. Instead, a weak reading could spur a wave of risk in favor of the euro, particularly if Wednesday’s consumer price index (CPI) data also turns out to be below expectations.
Federal Reserve Chairman Jerome Powell’s speech, scheduled for 4pm, will be closely monitored. Any indication that the prospect of a rate cut in September will move away could lead to further strengthening of the US dollar.
Currently, according to the FedWatch tool, the probability that US interest rates will remain unchanged in September is 35.2%.
