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Europe Releases Inflation and Unemployment Data This Week. Here’s What You Need To Know.
September 22,2022 15:26:52Following the European Central Bank announcing a record rate hike, the markets are set for some more big economic reports on inflation and unemployment this week.
Why are these reports so important?
The European Central Bank raised three key interest rates by 75 basis points at its recent meeting in a bid to tackle rising inflation. The Eurozone inflation rate climbed to its highest level since 1999, with consumer prices climbing 9.1% year-over-year in August and 0.6% on a monthly basis amid increasing energy and food costs.
The inflation report is due on Friday this week, and analysts are expecting the annual inflation rate to rise to 9.7% in September. If the inflation rate continues to accelerate, the ECB will be forced to announce another big rate hike at its upcoming meeting to bring the inflation back to its 2% target. The unemployment report will also be released on the same day, with the unemployment rate in the Eurozone expected to increase to 6.7% in August, from 6.6% in July.
Additionally, data on economic sentiment, services sentiment, industrial sentiment, consumer confidence and consumer inflation expectations for the Eurozone are also scheduled for release this week.
EUR/USD Prospects
An increase in the inflation rate is generally a negative thing for the domestic currency, as higher inflation eats into the value of the currency. But in the current scenario, any acceleration in inflation means more aggressive rate hikes by the central bank, which provides support to the currency. So, the EURUSD pair could see big moves this week.
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