The euro is still strong against the dollar this morning as expectations for ‘hawkish’ action from the European Central Bank grows.
These expectations were fuelled by eurozone flash inflation data yesterday, which revealed that inflation increased to 8.1% in May, an uplift from 7.4% previously and beating market predictions. This continues to be driven by rising energy prices.
Data released this morning showed that German retail figures dropped by 5.4% month-on-month in April, a much greater fall than forecasts predicted.
There will be a series of PMI data released for the eurozone this morning, followed by speeches from European Central Bank officials, including President Christine Lagarde. The markets will be listening for any comments surrounding interest rates.
