 The forex markets showed rather muted response to the latest batch of economic data released today. Euro has continued its near-term recovery, unaffected by Eurozone's lower than expected CPI flash data coming. This lack of response likely stems from the understanding that a slight miss in CPI figures does not significantly alter ECB plans for a rate cut in June, supported by a growing consensus within the bank. Notably, even the more conservative members of ECB Governing Council have signaled openness to adjusting rates in June, further cementing expectations. On the other side of the Atlantic, Dollar has also remained stable despite stronger than expected ADP private job data, with marked acceleration in annual wage growth for job-changers. This tepid response suggests that traders are likely waiting for the more comprehensive non-farm payroll report before making any decisive bets. With Fed fund futures currently indicating less a 60% chance of Fed rate cut in June at this point, a strong set of NFP numbers could easily sway the balance... |
