EUR/USD tests daily lows on CPI, near 1.2340

• The pair comes down to test session lows in the 1.2345/40 band.
• EMU’s final CPI in March came in at 1.3%, a tad lower than flash readings.
• Later in the NA session, Fedspeak and the Fed’s Beige Book are due.

EUR/USD is now testing the area of session lows in the 1.2345/40 region in the wake of the final release of inflation figures in Euroland for the month of March.

EUR/USD now looks to US docket

Spot gained some extra downside pressure after final inflation figures in the euro region tracked by the CPI showed headline consumer prices rose at an annualized 1.3% vs. the preliminary gain of 1.4%. On a monthly basis, price rose 1.0%.

Furthermore, consumer prices stripping Food and Energy costs rose in line with the flash readings 1.4% MoM and 1.0% over the last twelve months.

In the meantime, spot remains under pressure in light of the renewed pick up in the demand for the greenback against the backdrop of a continuation of the risk-on sentiment.

Next on the docket will be the publication of the Fed’s Beige Book and speeches by NY Fed W.Dudley (permanent voter, centrist) and FOMC’s R.Quarles.

EUR/USD levels to watch

At the moment, the pair is losing 0.16% at 1.2350 and a breakdown of 1.2300 (low Apr.12) would target 1.2214 (low Apr.6) en route to 1.2153 (low Mar.1). On the upside, the immediate resistance aligns at 1.2414 (high Apr.17) followed by 1.2478 (high Mar.27) and then 1.2538 (high Jan.25).