EUR/USD Reverses Close to 1.20 Again, as Eurozone Inflation Remains Negative - Forex News by FX Leaders
The ECB is taking note of low inflation figures

EUR/USD Reverses Close to 1.20 Again, as Eurozone Inflation Remains Negative

Posted Tuesday, December 1, 2020 by
Skerdian Meta • 1 min read

Inflation was weakening in the Eurozone earlier this year, during the lockdowns in spring, although it was holding up in positive territory until August. In August, the CPI (consumer price index) turned negative, declining by 0.2% YoY, while in September it fell by 0.3%.

In November, the CPI was expected to tick higher to -0.2% again, but it fell short of the expectations and remained at 0.3%. Below, you will find the inflation report for November:

Latest data released by Eurostat – December 1, 2020

  • November preliminary CPI -0.3% vs -0.2% expected
  • October CPI was -0.3%
  • November Core CPI YoY +0.2% vs +0.2% expected
  • October core CPI was +0.2%

Eurozone inflation remains more subdued, with the readings unchanged for November, as core inflation stays at a record low. The ECB will be taking further action next month, in an effort to deal with the fallout from the virus crisis, in the hopes that it will inadvertently spur higher price pressure into the new year.

The EUR/USD was climbing towards 1.20 this morning, after it pierced that big round level yesterday and retreated back down. But, it reversed lower today, reaching 1.1980, which is a sign that buyers are perhaps done, now that they have reached that level, and we might see a decent pullback lower in the coming days.

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About the author

Skerdian Meta // Lead Analyst
Skerdian Meta Lead Analyst. Skerdian is a professional Forex trader and a market analyst. He has been actively engaged in market analysis for the past 11 years. Before becoming our head analyst, Skerdian served as a trader and market analyst in Saxo Bank's local branch, Aksioner. Skerdian specialized in experimenting with developing models and hands-on trading. Skerdian has a masters degree in finance and investment.
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