The major currency pair has declined slightly but looks rather stable before new macroeconomic reports. The current quotation is 1.1580.
Yesterday the trading day brought good news from the Euro zone. ZEW business sentiment index in November grew to 25.9 against 21 previously and the forecast 20.6. The same indicator in Germany reached 31.7 from 22.3 points previously.
Business sentiment must have improved thanks to almost complete abolishment of coronavirus restrictions inside European economies. The freer the conditions – the better for business and customers.
The US PPI in October also improved to 0.6% m/m, as expected, after previous growth by 0.5%. This means that prices grow gradually along the whole chain from the crude material supplier to the final customer.
Today is going to be an interesting day in terms of statistics. All eyes are on the US report on the CPI in October. The forecast inflation is at once 0.6% m/m higher than last month, after previous growth by 0.4% m/m. Base inflation could have extended by 0.4% m/m against previous growth by 0.2% m/m. However, current high inflation (its y/y values are renewing the highs) cannot make the Fed cancel it decision to reduce stimulation. Probably, a month or two later the Fed might speed up the process to increase the interest rate faster and hold back the growth of prices. Hence, depending on the data from today, volatility of the dollar might grow significantly, if real values turn out higher than forecast.