No surprises in the final inflation read for the euro-zone in March. Headline inflation was confirmed at 1.5% and core CPI remains at the lower level of 0.7%. Core inflation stood at 0.9% for many long months and the drop to 0.7% is a setback.
EUR/USD is ticking lower, trading at 1.0714. ECB President Mario Draghi will feel vindicated with his dovish stance, contradicting some of the more hawkish members at the Governing Council.
A separate release showed that the trade balance surplus expanded to 19.2 billion euros, above 18.6 predicted.
The euro-zone was expected to confirm that inflation cooled down in March. The initial flash figures showed a year over year rise of 1.5% in headline CPI and 0.7% in Core CPI, down from 2% and 0.9% seen in February.
EUR/USD was trading steadily around 1.0720 ahead of the publication, consolidating some of its gains. The advance was fuelled mostly by the dollar’s weakness rather than due to any kind of strength in the single currency.
Tension is growing towards the French elections.
