The soft landing | 13 5月 2022

13 5月 2022, EUR/USD

The soft landing

EURUSD trading plan:

U.S. producer price inflation showed signs of peaking in April but remained in double digits. The annual rate of factory gate inflation fell to 11.0% from 11.5%, as the monthly rise in prices slowed to 0.5% from 1.6% in March. But there were also signs of weakening price trends in the core PPI, which excludes volatile food and energy prices. Core PPI rose by only 0.4% on the month, less than the 0.6% expected and a clear slowdown from an upwardly-revised 1.2% in March. In annual terms, the core PPI eased to 8.8% from 9.6% a month earlier. Powell, who was confirmed earlier on Thursday to a second four-year term as Fed chief on a bipartisan 80-19 vote in the U.S. Senate, has paid frequent homage to Volcker's commitment to beating inflation, while also saying he believes the U.S. central bank this time can navigate the economy to a "soft landing" where inflation falls without a downturn or significant increase in joblessness.

Investment idea: sell 1.0415 and take profit 1.0365.

David Johnson
Analyst of «FreshForex» company
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