EUR/USD bullish after strong EU retail sales; US inflation data ahead
- The EUR/USD turned bullish after the strong EU retail sales data.
- There’s optimism that the EU will ramp its vaccination drive.
- Focus shifts to the latest US inflation data set for Tuesday.
The EUR/USD price rebounded on Monday after the relatively strong Eurozone retail sales numbers. It is also rising ahead of the important US inflation numbers set for Tuesday afternoon. It rose to 1.1907, which was slightly above the intraday low of 1.1870.
EU retail sales numbers
The volume of retail sales in the Eurozone rebounded in February even as countries imposed lockdowns in a bid to halt the spread of the coronavirus. According to Eurostat, the total retail sales rebounded by 3.0% in February after crashing by 5.2% in January. This rebound was better than the median estimate of 1.5%.
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The sales fell by 2.9% on a year-on-year basis, an improvement from the previous 5.2%. It was also better than the median estimate of -5.4%.
According to Eurostat, sales dropped mostly in countries like Portugal, Slovakia, and Malta. They increased mostly in Belgium, Austria, and Croatia. The increase was led by a 1.9% increase of food, drinks, and tobacco.. Automotive fuels dropped by 11.9% as more people spent at home.
The EUR/USD pair also rose on news that EU countries are ramping up their vaccination drive. Leaders in the bloc hope to vaccinate 50% of adults population by late July this year. This is still a lower pace than the United States and the UK, which have already vaccinated 48% and 33% of their population. It also depends on a seamless supply of shots from manufacturers like Pfizer and AstraZeneca.
Meanwhile, the EUR/USD is rising ahead of the latest US inflation numbers that will be published tomorrow. Analysts are optimistic that consumer prices rose sharply in March this year as more states reopened. Further, the $1.9 trillion stimulus package helped to boost the prices. Precisely, analysts expect that the headline CPI will rise by 2.5%, also because of higher crude oil prices. Core CPI is expected to rise to 1.6%.
EUR/USD technical forecast
The EUR/USD price rose after the strong EU retail sales numbers today. It rose to an intraday high of 1.1907, which was slightly below last week’s high of 1.1927. It has also moved above the 38.2% Fibonacci retracement level on the four-hour chart. Also, it has risen above the 25-day and 15-day exponential moving averages. As you will find in our free forex trading course, this is a bullish signal. Therefore, in the near term, the price could soar to the 50% retracement at 1.1973.