EUR/USD hovers below 1.1400 as Eurozone inflation falls below ECB’s 2% target
EUR/USD moves little after registering losses in the previous session, trading around 1.1380 during the Asian hours on Wednesday. The pair may appreciate as the US Dollar (USD) struggles due to traders’ caution amid rising tariff uncertainty and its potential to hurt growth in the US economy.
Job Openings and Labor Turnover Survey (JOLTS) Job Openings posted 7.39 million new positions in April, higher than March’s 7.2 million openings. This figure surprisingly came in above the market expectation of 7.1 million.
Traders await the US Nonfarm Payrolls (NFP) report for May, which is expected to show 130K job additions. If the report showed a stronger-than-expected outcome, this might lift the Greenback and put downward pressure on the EUR/USD pair.
US Treasury Secretary Scott Bessent said on Sunday that Trump and Xi Jinping were expected to meet soon to resolve trade disputes. China’s Ministry of Commerce said on Monday that China had complied with the agreement by cancelling or suspending relevant tariff and non-tariff measures aimed at the US "reciprocal tariffs." Last week, US President Donald Trump accused China of breaching a truce on tariffs reached earlier this month.
The Eurozone Harmonized Index of Consumer Prices (HICP) fell by 1.9% year-over-year in May, below the ECB’s 2% target for the first time in eight months. Core HICP, excluding volatile items, declined by 2.3% YoY, down from 2.7% in the previous month.
As the HICP May’s inflation falling below the European Central Bank’s (ECB) target, it reinforces expectations that the central bank might cut rates this week. Financial markets had fully priced in the odds of the ECB reducing its Deposit Facility Rate by 25 basis points (bps) to 2% at the upcoming monetary policy meeting.
Source: Fxstreet
