Despite the Rise in the Consumer Price Index, Market Participants May Be Wary of the Euro's Downward Potential

Despite the Rise in the Consumer Price Index, Market Participants May Be Wary of the Euro's Downward Potential

04.03.2026

In the U.S. currency market yesterday, the U.S. dollar rose against the euro. The EUR/USD pair fell from 1.1705 to 1.1532. It declined as it encountered resistance at the 10-period moving average on the hourly chart.On the 4-hour chart, the price continues to move along the -2σ line of the Bollinger Bands. On the daily chart, the price broke below the 200-day SMA support level with a real body candle, setting a new year-to-date low.

European currencies saw the euro fall against the pound, despite yesterday’s release of the Eurozone’s February Harmonized Index of Consumer Prices (HICP), which rose 0.2 percentage points year-over-year to 1.9% from the previous month’s 1.7%.The euro/pound pair fell from 0.8739 to 0.8690. It reversed lower after hitting resistance at the 200-period simple moving average (SMA) on the hourly chart. On the 4-hour chart, the pair has already broken below the 200-period SMA support line, and on the daily chart, the candlesticks are moving downward from the 20-period moving average (MA), which had previously provided support.

Today’s economic indicators include Australia’s fourth-quarter GDP at 9:30, Switzerland’s Consumer Price Index at 16:30, France’s Non-Manufacturing PMI at 17:50, Germany’s Non-Manufacturing PMI at 17:55, the Eurozone’s Non-Manufacturing PMI at 18:00,remarks by SNB Vice Chairman Martin of Switzerland, at 6:30 p.m. UK Non-Manufacturing PMI, at 7:00 p.m. Eurozone Producer Price Index and Eurozone Unemployment Rate, at 9:00 p.m. U.S. MBA Mortgage Applications Index, at 10:15 p.m. U.S. ADP Employment Report,at 10:30 PM, Canada’s Q4 Labor Productivity Index; at 11:45 PM, the U.S. Non-Manufacturing PMI; at 12:00 AM, the U.S. ISM Non-Manufacturing PMI; at 12:30 AM, remarks by BOC Governor McClem of Canada; and U.S. weekly crude oil inventories are scheduled.Despite the rise in the Consumer Price Index, we should remain cautious about the euro’s downside potential as it continues to weaken.