(BFM Bourse) – The European currency fell 0.9% against the greenback after the publication of inflation above expectations in the United States in August.
Sudden trend reversal for the euro. The eurozone currency rose sharply against the dollar on Monday, continuing a rally that began on Friday. But the publication of inflation figures in the United States at 2:30 p.m. turned the situation upside down.
Thus, shortly after 3 p.m., the euro plunged 0.9% against the dollar to 1.0028 dollars, while it gained around 0.6% shortly before these data. The currency of the euro zone is not the only one: the pound sterling gives up 1.1% against the greenback.
According to the US Bureau of Statistics and Labor, the consumer price index, the best-known barometer of inflation, rose 8.3% in August. An increase certainly lower than that of July (+8.5%) but clearly above the expectations of economists who were counting on a figure of 8%, according to a consensus compiled by Dow Jones Newswires.
The markets were hoping for a marked slowdown in inflation in August so that the monetary tightening that the American Federal Reserve (Fed) is in the process of operating will ease over the next few months.
These statistics “confirmed that inflation is still just as strong in the United States,” notes Naeem Aslam of AvaTrade. “It makes the situation much more difficult for the Fed which is doing its best to control inflation,” he continues.
Julien Marion – ©2022 BFM Bourse