The economic calendar features several high-profile events on Wednesday, with reports from the Eurozone, United Kingdom and United States set to make headlines.
Germany gets the ball rolling at 06:00 GMT with August inflation data. The final consumer price index (CPI) is forecast to come in at 1.8% annually in August. The harmonized index of consumer prices (HICP) is expected to see a similar level.
Spain will also release final inflation numbers at 07:00 GMT. About 15 minutes later, Switzerland will report on producer inflation for the month of August.
The United Kingdom’s National Statistics will report on August jobs data at 08:30 GMT. The claimant count change is forecast to rise by 600. The ILO unemployment rate likely held steady at 4.4% in the three months through July.
Meanwhile, average earnings excluding bonuses are forecast to rise 2.2% annually between May and July. Including bonuses, average earnings are projected to come in at 2.2% for the same period.
The European Commission’s statistical agency will also release a batch of headline data on Wednesday. At 09:00 GMT, reports on July industrial production and second quarter employment will make headlines.
Shifting gears to the United States, the Department of Labor will issue its monthly producer price index (PPI) at 12:30 GMT. Producer inflation is forecast to rise 0.3% in August and 2.5% annually.
Oil traders will be keeping a close eye on the weekly crude inventory report from the US Energy Information Administration (EIA). At 14:30 GMT the EIA is expected to show a stockpile increase of 2.285 million barrels in the week ended 4 September, following an increase of 4.58 million the week before.
The euro fell back below 1.2000 US on Tuesday, as the dollar continued to stabilize against a basket of world peers. The EUR/USD was up 0.2% in Wednesday’s Asian session to trade 15 pips below 1.2000. The pair is trading well above the 21-day simple moving average (SMA) and appears poised to cross back over 1.2000.
The British pound received a large boost on Tuesday after the release of upbeat inflation data, with the GBP/USD climbing above 1.3300 for the first time since last September. Cable continued to trade above 1.3300 on Wednesday after breaking above the 2017 high of 1.3266. The pair is now eyeing the 6 September 2016 high of 1.3447. On the opposite side of the ledger, immediate support is located at 1.3161, or the low from 11 September.
US crude prices have swung back above $48.00 in the aftermath of Hurricane Irma. The contract was last seen trading around $48.30 a barrel. The 15-minute moving averages show a neutral outlook for the commodity, with the RSI hovering near 50 and the MACD slightly above the zero line.