Euro Stands Firm Above 1.16 Ahead of Inflation Data

The Euro has held onto its gains above 1.1600 ahead of the upcoming release of Eurozone HICP inflation data. This comes as Germany's Consumer Price Index (CPI) inflation rate climbed to 2.9% year-over-year in August, matching market consensus and marking a third consecutive monthly increase.

The European Central Bank (ECB) is likely to hike borrowing costs again at its next policy meeting on September 10, with traders betting on further monetary tightening next year.

Hawkish remarks from the US central bank may also contribute to a stronger Greenback and cap the upside for the EUR/USD pair. The EUR/USD currently trades at 1.1622, holding a constructive bias above its 20-period Bollinger middle band at 1.1600.