On Friday we will get the CPI report for November out of the Eurozone. Mario Draghi mentioned that inflation needs to be created rather fast, but Friday’s report may show yet another tick lower. Economists expect the annualized CPI to decrease to 0.3% from October’s level of 0.4%. The core CPI is expected to remain unchanged at 0.7%. Despite this expected slowdown in the CPI I do expect the Euro to rally after the release unless we see a figure below 0.3%.
The Euro has show resilience and moved higher and I do share your point of view that the Euro will resume to advance, but I am a bit bearish on the EURAUD.