EUR/USD trades around 1.1550 on Wednesday at the time of writing, up a modest 0.08% on the day.
The pair experiences a brief spike in volatility following the release of United States (US) inflation data but quickly returns to levels seen before the publication, as the figures broadly match market expectations
Inflation in the US, as measured by the Consumer Price Index (CPI), slowed to 3.4% YoY in July from 3.5% in June, according to the Bureau of Labor Statistics (BLS). On a monthly basis, prices rose by 0.1%, following a 0.4% decline in June. The core CPI, which excludes volatile food and energy components, increased by 0.2% MoM and 2.5% YoY.
All the figures align with market forecasts. The reaction of the US Dollar (USD) remains subdued, as the data provide no significant surprise likely to materially alter expectations regarding the Federal Reserve’s (Fed) monetary policy outlook. The US Dollar Index (DXY), which measures the value of the Greenback against a basket of six major currencies, edges slightly lower following the release.