Market news 23.02.2024

ECB survey: consumers predicted inflation to rise to 3.3% in the coming year in January.

Inflation expectations of consumers in the European region for the coming year rose from 3.2% in December to 3.3% in January, the European Central Bank's (ECB) monthly survey of consumer expectations showed on Friday.

However, expectations for three years ahead were unchanged and held around 2.5%.

The survey found that expectations for nominal income growth are still the same at 1.2%, but consumers are still underestimating wage growth, and the ECB believes compensation per employee will rise by 4.6% this year.

EUR/USD: relative stability of the euro is probably justified – ING.

Germany's struggling economy will remain the center of attention today. ING economists are analyzing the outlook for EUR/USD ahead of the release of the IFO German environment survey.

Germany's manufacturing PMI fell to 42.3 in February, overshadowing a slight increase in the services sector. The IFO survey will be released today, and the data is likely to be weak as well. For now, it is impossible to say definitively whether the downturn in Germany is already embedded in the EUR exchange rate, or whether some other factors have prevented it from taking the full brunt of the blow.

Inflation - and, of course, wages - are always in the spotlight, so we should not be surprised by the relative stability of the euro, and the downside risks for EUR/USD in the short term are mostly related to the dollar's growth potential.

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The information contained in this material should not be construed as trading recommendation. The analytical forecast is the subjective opinion of the author and cannot guarantee income.