Euro rises 0.71% as stable inflation data boosts investor confidence

EURUSD Analysis

Performance after Monday
Period	Pct	Chg	Momentum
Monday	0.71%	79.1 Pips
Week to-date	0.61%	68 Pips
May	-0.82%	-93.3 Pips

Upcoming key events (London Time)

Wed 01:00 AM EUR G7 Meeting

What happened lately

The Euro Area Consumer Price data revealed several layers of stability in April 2025. The Euro Area Core Harmonized Index of Consumer Prices (HICP) remained unchanged from March at 2.7%, as reported by Eurostat. This indicates that underlying inflationary pressures, excluding volatile items like food and energy, held steady. Similarly, the overall Euro Area Core HICP also showed consistency at 1%, illustrating that the broader inflationary environment remained stable without sudden shifts since March. Moreover, the Euro Area Harmonized Index of Consumer Prices itself remained consistent at 0.6%. These figures suggest that inflationary pressures within the Euro Area have currently stabilized, potentially reflecting cautious optimism in the policy-making environment regarding inflation control.

The EURUSD rose by 0.71% to 1.12431, likely influenced by the stable inflation data from the Euro Area. The stable inflationary data could have been perceived positively by investors, as it indicates inflation is subdued and within a manageable range, which is less likely to trigger abrupt monetary policy changes by the European Central Bank. This stability may encourage investor confidence, boosting demand for the euro, which in turn lifts the EURUSD pair. The upcoming high-impact G7 meeting may introduce further discussions concerning macroeconomic policies affecting the Eurozone, potentially affecting future movements in the currency pair. However, the current inflation data supports a positive outlook, suggesting continued strength for the EUR until further developments.

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What can we expect from EURUSD today?

EURUSD on Monday rose 0.71% to 1.12431. Price is above 9-Day EMA while Stochastic is rising.

Updated daily direction for EURUSD looks bullish as the pair ended higher after Monday trading session.

Looking ahead for the day, immediate upside resistance level is R1 at 1.12971 with break above could target R2 at 1.13511 or figure level area. While towards the downside, we are looking at daily low of 1.11711 as an important support. Break below this level could weaken the current bullish momentum. A break above 1.12881 may suggest continuation after recent positive movement.

For the week to-date, take note that EURUSD is mixed as compared to the prior week.

Key levels to watch out:

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