The EUR/USD price analysis supports a bullish bias as the euro climbs against a weak dollar after soft US wholesale inflation numbers. Meanwhile, a Reuters poll revealed that economists predict two more European Central Bank cuts this year, fewer than markets expect.

The dollar eased after data revealed that the US PPI increased by 0.1% in July. Meanwhile, analysts had expected a 0.2% increase. The more minor increase indicates weakening price pressures at the producer level. 

After the report, markets raised the likelihood of a 50 bps Fed rate cut in September from 50% to 53.5%. The move was little because the focus is now on the upcoming consumer inflation report. 

The CPI will likely increase by 0.2% in July. Meanwhile, the annual rate could stay unchanged at 3.0%. However, since the recent trend is weaker-than-expected numbers, the dollar might fall further. Moreover, if consumer inflation misses forecasts, the likelihood of a 50 bps rate cut in September will increase. Meanwhile, a weak dollar will allow the euro to continue climbing.

Elsewhere, a Reuters poll revealed that economists maintained their forecast for two more ECB rate cuts this year. An over 80% majority expect a rate cut in September and December. This survey boosted the euro because it is a less dovish outlook than what markets expect. Traders are betting on three more ECB cuts before the year ends.

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EUR/USD key events today

• Core CPI m/m
• CPI m/m
• CPI y/y

EUR/USD technical price analysis: Bulls seek new high above 1.1000

EUR/USD 4-hour chart

On the technical side, the EUR/USD price is on the brink of making a new high above the 1.1000 psychological resistance level. The bullish bias is strong, with the price well above the 30-SMA. At the same time, bulls are pretty enthusiastic with the RSI in the overbought region.  

Therefore, there is a high chance the price will breach 1.1000 to make a higher high. On the other hand, if the resistance holds firm, EUR/USD might pull back to retest the 30-SMA before continuing higher. The bias will only shift if it goes below the SMA. 

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