12.06.201822:54 Forex Analysis & Reviews: Inflation data did not help the US dollar

Despite the weak data on the prospects for the German economy, the European currency managed to regain important resistance levels, and continues to trade with the prospect of further growth.

Data on worsening sentiment regarding the German economy in June this year did not affect risky assets.

According to the report of the German institute ZEW, the leading index of economic expectations ZEW in June 2018 decreased to -16.1 points from -8.2 points in May. Economists predicted a decline in the indicator to -15.0 points.

As ZEW President stated, the main reason for the sharp decline in the index was the escalation of the tension of trade relations between the US and the European Union. The political problems of the populist Italian government, which is pro-European, also affects sentiment, which could negatively impact on Germany's economic prospects.

Inflation data in the US, which came out in the afternoon, did not lead to a surge in volatility, as it fully coincided with the forecasts of economists.

Given the statistics released, the Fed leaders now have enough grounds for further interest rate increases, as inflation in the US in May this year has continued. However, if there is enough acceleration in the consumer price index for representatives of the Fed, it is not known exactly.

According to the report of the US Department of Labor, the consumer price index in May this year increased by 0.2% compared with the previous month, compared with the same period in 2017, inflation increased by 2.8%.

The base index, which does not take into account the volatile categories, namely the prices of food and energy, increased by 0.2% compared to April and by 2.2% compared to May 2017.

As for the technical picture of the EUR / USD currency pair, it remained unchanged compared with the morning forecast.

The British pound managed to strengthen its position against the US dollar after the report, which indicated that the number of employees in the UK in the period from February to April continued to grow. And this is provided that the pace of wages has slowed.

According to the National Bureau of Statistics, between February and April this year, the number of employed British nationals increased to 32.4 million, and the unemployment rate remained unchanged in the region of 4.2%.

As for the growth of wages, then everything is not so good. The growth rate slowed down to 2.8% from 2.9% in the previous three-month period. Economists had expected the indicator to remain unchanged at 2.9%.