While noting the negative impact of the Ukraine war on the economy, the European Union (EU) Economic Commissioner Paolo Gentiloni said that inflation is expected to surge further following the 6.2% recorded in February.

Key quotes (via MNI)

"Our economies were strongly reopening after the pandemic crisis at the beginning of year, and we expected at EU level and in Romania, strong growth of around 4%.”

“Of course, the impact of the war will affect this growth and we see already the impact on inflation - it climbed 6.2% in the EU and 7.9% in Romania in February - and we can expect these figures to go further."

"And we are seeing a certain level of uncertainty bringing down confidence among consumers and investors.”

Market reaction

EUR/USD almost tested 1.1000 amid a renewed downtick in the US Treasury yields across the curve. However, the notable US dollar demand keeps the bullish potential limited in the main currency pair.

The spot is now trading at 1.0971, down 0.06% on the day.