March 21 (Reuters) - EUR/USD traded lower Friday but remained within its recent consolidation range and above key support near the 200-DMA and 1.0760/70 zone as investors awaited a catalyst, with U.S. February PCE inflation due on March 28 a potential candidate to spark a move. Particular attention could be placed on U.S. inflation data after the Fed's SEP lowered GDP projections but increased 2025 projections for price growth. Fed Chair Jerome Powell said that tariffs could drive inflation but that price increases could be transitory, which suggests policy makers could be looking past U.S. President Donald Trump's tariff and trade policies and are more focused on growth.

Investors may also be looking past those influences.

U.S. 2-year and 5-year break even inflation rates have been trending downward since mid February, which has helped weigh down the U.S. dollar as it is correlated with break evens.

Month-on-month headline and core PCE are estimated at +0.3, which would match January's result. Year-on-year core PCE is expected to rise to 2.7% from 2.6% while headline is expected to match January's 2.5%.

Below estimate or as expected results could indicate disinflation is in place or ease investors concerns inflation is running hot. If so, U.S. yields might sink and the dollar's yield advantage over the euro could decrease as German-U.S. spreads

and terminal rate spreads for the Fed and ECB tighten.

EUR/USD may end its consolidation phase and resume the broader up trend.
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(Christopher Romano is a Reuters market analyst. The views expressed are his own)