tomorrow morning the euro area’s consumer price inflation rate is set to be unveiled anticipated to continue its downward trend however the magnitude of this decrease will play a significant role in shaping the european central bank’s ecb approach to future rate hikes last month’s preliminary estimate showed a decline to 55 percent in june 2023 down from 61 percent in the previous month slightly below market expectations of 56 percent while this drop marked the lowest rate since january 2022 it remained notably above the ecb’s target of 20 percent notably the core rate excluding volatile items like food and energy increased to 54 percent remaining close to its recent peak of 57 percent this strengthens the view that policymakers are likely to continue their rate hike trajectory in the coming months energy prices experienced a sharp decline of 56 percent versus 18 percent in may while prices for food alcohol  tobacco and nonenergy industrial goods rose at a slower pace on the other hand services inflation picked up to 54 percent from 50 percent on a monthly basis consumer prices advanced by 03 percent in june in addition to the overall inflation rate tomorrow’s reports will also shed light on the annual core inflation rate in the euro area which excludes energy food alcohol and tobacco last month this rate rose for the first time in three months to 54 percent in june 2023 from 53 percent in may just slightly below market forecasts of 55 percent back in march core inflation hit a record high of 57 percent indicating its significant impact on the economy comparatively the core cpi increased by 03 percent from the previous month from a technical perspective the eurusd pair is currently at the 100 extension with traders grappling with uncertainty about its next move tomorrow’s data releases are poised to guide price action potentially leading to either a pullback or an extension upwards as the ecb continues to increase rates the upcoming reports will offer insights into their stance reflecting either more measured or assertive approaches surpassing expectations could indicate fewer rate hikes fostering growth in equity markets conversely strongerthananticipated inflation could prompt a more forceful response from the ecb potentially leading to a decline in equity markets