eurozoneCPIlower2.9%, Q3GDPLess than expected, Euro/Short term USD commitment...

Eurozone as a wholeCPIAnd the coreCPIContinuing the downward trend, with the overallCPISignificantly lower than expected2.9%Simultaneously announced in the third quarterGDPNot as expected; stayCPIContinuous decline, third quarterGDPNegative month on month growth andPMIIn the case of falling into a contraction zone, the euro is facing significant downward pressure; Next, euro traders will shift their focus to heavyweight data and event risks from the US side.

eurozone10Monthly inflation has significantly cooled down

Tuesday（10month31On the same day, the Eurostat released inflation data for the Eurozone, which showed:

eurozone10Monthly overallCPIYear-on-year growth2.9%, Previous value4.3%, expected3.1%；

eurozone10Monthly overallCPIMonth on month growth0.1%, Previous value0.3%, expected0.3%；

eurozone10Monthly CoreCPIYear-on-year growth5%, Previous value5.5%, expected5.1%。

From the perspective of sub items, the prices of food, alcohol, and tobacco have increased year-on-year7.5%Below9Of8.8%Remains the main driving factor for inflation in the eurozone; Next is service industry prices, with year-on-year growth4.6%Below9month4.7%; Then comes the prices of non energy industrial commodities, with year-on-year growth3.5%Below9Of4.1%; Finally, energy prices, a year-on-year decrease11.1%Below9Of-4.6%。

chart1 eurozone10monthCPIYear-on-year growth

Chart source: Eurostat

The overall inflation and core inflation in the Eurozone continue to decline, with overallCPISurprisingly significant cooling. Simultaneously announced the third quarter of the eurozoneGDPAnnual rate initial value recorded0.1%, lower than expected0.2%; Third quarterGDPRecorded initial seasonal rate values-0.1%, lower than expected0%。

The third quarter of France announced earlierGDPAnnual rate initial value recorded0.7%, in line with expectations; Third quarterGDPRecorded initial seasonal rate values0.1%, in line with expectations; FranceCPICompared to the same period last year9Of4.9%Significant decline to10Of4%。

Boosted by French data, the euro/The US dollar continues to rise, but in the eurozoneCPIandGDPAfter the data was released, the euro/The US dollar experienced a short-term decline.

chart2 euro/US dollars, German American bonds2年期殖利率15Minute chart

Chart source:TradingView

As of now, the comprehensive eurozone10monthPMI、10monthCPIAnd the third quarterGDPLooking at it, the economic outlook for the Eurozone is still showing a weak trend, and a significant drop in inflation can basically confirm that the European Central Bank will not raise interest rates again. In this situation, the euro is facing more obvious downward pressure.

Compared to the following, the sustained strength of the US economy continues to provide support for the US dollar, and in the short term, the euro/Any rebound in the US dollar may be unsustainable. Next, euro traders will shift their attention to heavyweight economic data and event risks from the US side, including labor market data such as Thursday's Federal Reserve interest rate resolution and Friday's non farm payroll report.