30 Apr 2014
All eyes on EMU's CPI - Investec
FXStreet (Barcelona) - Jonathan Pryor, Corporate Treasury Analyst at Investec remarks the relevance of today's inflation figures in the euro bloc.
Key Quotes
"ECB President Mario Draghi said in the April Policy press conference that the ECB were "surprised" by last month's low inflation reading of 0.5% yoy. The implication that this low level would not persist is backed by market analysts, who are expecting today's Euro Area inflation number to come in higher, retracing back to 0.8%. Yesterday's weaker than expected inflation number from Germany, the Euro Area's largest economy, has cast doubt on such a strong retracement and led to the euro being sold."
"Today's Euro Area inflation estimate will be watched closely as a second very weak inflation month raises the chances that we see the ECB spring into easing action as they did in November after inflation first dropped to worrying levels. It is worth noting the ECB mandate is price stability in the medium term - so persistently low inflation data or a very low spike is needed first before they will act."
Key Quotes
"ECB President Mario Draghi said in the April Policy press conference that the ECB were "surprised" by last month's low inflation reading of 0.5% yoy. The implication that this low level would not persist is backed by market analysts, who are expecting today's Euro Area inflation number to come in higher, retracing back to 0.8%. Yesterday's weaker than expected inflation number from Germany, the Euro Area's largest economy, has cast doubt on such a strong retracement and led to the euro being sold."
"Today's Euro Area inflation estimate will be watched closely as a second very weak inflation month raises the chances that we see the ECB spring into easing action as they did in November after inflation first dropped to worrying levels. It is worth noting the ECB mandate is price stability in the medium term - so persistently low inflation data or a very low spike is needed first before they will act."