Euro Gains Ahead: ING Predicts Dollar Weakness if U.S. CPI Misses Expectations
According to ING's FX strategy team, the euro may strengthen against the dollar if the upcoming U.S. Consumer Price Index (CPI) report shows a softer-than-expected inflation rate.
The analysts highlighted that a below-consensus CPI reading could weigh on the dollar and provide additional support for the euro.
A soft CPI print would likely reinforce market bets that the Federal Reserve will begin cutting interest rates sooner than previously anticipated, reducing the dollar's appeal to investors seeking yield and potentially leading to dollar depreciation.
The euro has traded in a relatively tight range against the dollar over the past few weeks, hovering near the 1.08 level. A break above the 1.0850 resistance could open the door for further gains, while support sits around 1.0750.