EUR/USD challenges 1.2300 on German CPI, Powell comes next

• The pair dropped further on downbeat German CPI figures.
• German advanced CPI sees consumer prices up 1.4% in February.
• Powell’s Humphrey-Hawkins hearing is next of relevance.

EUR/USD eased further tp the 1.2310 area in the wake of the publication of flash German inflation figures for the month of February.

EUR/USD offered on weak data, Powell eyed

The pair gained extra downside traction after German preliminary inflation figures now see headline consumer prices rising at an annualized 1.4% on a year to February and 0.5% on a monthly basis.

In addition, the broader HICP also came in below expectations, showing prices are expected to rise 1.2% over the last twelve months and 0.5% inter-month.

Spot remains under pressure in the meantime, as market participants will now shift their attention to the imminent semi-annual testimony by Chief J.Powell, where inflation prospects and the Fed’s rate path should be on top of the agenda.

Later in the day, CB’s consumer confidence, January’s trade balance figures and Durable Goods Orders are also expected in the US docket.

EUR/USD levels to watch

At the moment, the pair is losing 0.11% at 1.2303 facing the immediate support at 1.2260 (low Feb.22) followed by 1.2206 (low Feb.9) and finally 1.2165 (low Jan.18). On the other hand, a break above 1.2361 (21-day sma) would target 1.2366 (10-day sma) en route to 1.2537 (high Jan.25).