IPC américain le 10 juin - Opportunité de marché EUR/USD

US will release the latest m/m inflation (CPI) on June 10, last month price rose 0.6% and is still rising, all this data is coming right before FOMC meet - June 16,17. So, market will react fast, be prepared.

US interest rate is at 3.75% and is higher than Europe's 2.15%. As you know, higher rates attract money into dollars, which keeps EUR/USD under pressure. Whether Fed cuts rates or keeps them high, depends heavily on inflation.

• If inflation cools below 0.4% monthly, Fed more likely will cut rates, hence dollar weakens and EUR/USD goes up.

Goldman Sachs sees EUR/USD hitting 1.25 by the end of the year and JPMorgan targets 1.20. So longterm trend is bullish.

• Inflation stays high, above 0.6% monthly, rate cuts will have to wait, there might even be measures taken to hike the rates, as a result dollar will strengthen and EURUSD will under pressure.

In this case, EUR/USD will drop back to 1.12.

What to Expect

Chances are May CPI comes in above 4.2% yoy, so inflation will stay high. The reason behind is of course, US war on Iran, which triggered a massive oil shock, prices went up in a single month. Now with this report on June 10, we will be able to understand if high fuel costs have now spread into everyday prices, or whether oil's recent pullback means the worst is over.

Until that's clear, the Fed won't cut rates and the dollar stays strong, keeping EUR/USD will decrease.

Bottom line, EUR/USD trend is bullish rising over the coming months. June 10 either confirms that or delays it.