German inflation misses estimates
The euro's response to soft regional and national German inflation has been impressive. It's back near the highs of the day, up 50 pips to 1.2430.
It had wobbled down near 1.2400 on a decent-sized miss on German inflation but has bounced back.
A big part of the reason is that the ECB doesn't really need rising inflation to end QE programs and hikes rates. Both programs are at crisis levels so they could 'normalize' even without substantial inflation.
At the same time, the euro's ability to shake off bad news is a good sign for underlying demand. Yesterday's decline has been erased.
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