EUR/USD Retreats to 1.0800 as Mixed Data, US Inflation Weigh

EUR/USD stumbled back towards 1.0800 on Thursday, following weaker-than-expected German Retail Sales and mixed Consumer Price Index (CPI) data. Although US Personal Consumption Expenditure Price Index (PCE) met forecasts, investor confidence remains shaky as stubbornly high inflation could delay potential Federal Reserve (Fed) rate cuts.

Friday brings crucial pan-European Harmonized Index of Consumer Prices (HICP) inflation figures for February, along with the February US ISM Manufacturing report. Forecasts anticipate a slight easing in European HICP inflation, while the US ISM Manufacturing PMI is expected to show a modest recovery but remain below the 50 mark, indicating contraction.

EUR/USD has remained rangebound since surpassing 1.0800 on February 20, facing supply pressure near 1.0860 and strong demand above 1.0800. Short-term technicals suggest a potential bullish recovery if selling pressure fails to push the pair below 1.0800. However, EUR/USD continues to hover around the key 200-day Simple Moving Average (SMA) at 1.0828, leaving it vulnerable to further downside pressure.