Euro wins some ground versus the US Dollar.
After new eight-month lows around 1.0490, the Euro (EUR) tries to regain some bullish impetus versus the US Dollar (USD), urging the EURUSD to retake the 1.0500 barrier and above in the old continent’s opening bell on Thursday.
Following fresh year-to-date highs, the DXY USD Index gives up some gains.
The Greenback’s rally, on the other hand, When measured by the USD Index (DXY), it faces some headwinds after reaching fresh 2023 peaks in the 106.80-106.85 region. The index’s jolt coincides with the lack of direction in US rates, which have remained at multi-year highs throughout the curve.
The same thing is happening in Germany’s money market, where 10-year bund rates are approaching 2.90% for the first time since mid-July 2011.
In terms of monetary policy, investors continue to anticipate the Federal Reserve (Fed) raising interest rates by 25 basis points (bps) before the end of the year. At the same time, market talks continue to point to a probable ECB pause, despite inflation remaining well over the bank’s objective and expanding. Concerns about a probable recession.
Later in the afternoon, Germany’s preliminary inflation rate will command the most interest, followed by Eurozone Economic Sentiment and Consumer Confidence in the eurozone as a whole.
Across the Atlantic, investors will be watching for the publication of the final Q2 GDP figures, as well as the typical weekly Initial Jobless Claims and speeches by Chicago Fed President Austan Goolsbee and FOMC Governor Lisa Cook. In addition, Chair Jerome Powell will attend a gathering of educators in Washington, DC.
Daily market movers: The euro is showing signs of life around 1.0500.
The euro has recovered from multi-month lows versus the US dollar.
On Thursday, US and German yields trade with no distinct direction.
Markets anticipate the Fed raising interest rates by25 basis points before the end of the year.
Investors predict the Fed cutting interest rates in the third quarter of 2024.
Traders believe the ECB’s tightening strategy has reached a stalemate.
According to preliminary figures, Spain’s inflation rate increased in September.
Concerns of intervention linger as the USDJPY near the 150.00 level.
