EURUSD has paused. Overview for 09.02.2023

EURUSD is hardly moving. The current quote is 1.0730.

The market has lived through serious changes in the moods – from panicking about statistics to becoming neutral again. This is time to get your nerve back.

Meanwhile, inflation remains one of the crucial topics. For example, an ECB representative Klaas Knot voiced yesterday that the general inflation in the Euro zone must have reached its peak. However, the economy might need to keep on increasing the rate like today if the base CPI does not shrink.

The monetary politician thinks that a sharp decrease in energy carriers prices might bring the general inflation down. At the same time, growth of wages in the region should propel inflation in the future. Inflation in services might be more rigid, while inflation in essentials should start falling one of the first.

On the whole, the ECB faces the same task as the Fed does: how to slow down inflation but save the economy? There has been no evolution in the instruments over the last decades, it seems. Central banks still cannot or do not want to act in several directions at once and prefer slowing down one thing in order to fix something else.

News is neutral, and without news, investors will hardly move.