EUR/USD Analysis Report: In spite of the weak DXY, EURUSD is attempting to approach the 0.9950 barrier.

Nov 07, 2022

VOT Research Desk

In the Tokyo session, the EURUSD pair is edging closer to the immediate barrier of 0.9950.

In spite of conflicting answers from the risk profile, the asset is primarily trading sideways.

The US dollar index (DXY), meanwhile, is trading sluggishly over 111.00. The DXY experienced a small retracement to 111.10 after Friday’s price movement was horrendous. The Federal Reserve (Fedearlier )’s decision to cut down the pace of raising interest rates was the main driver of the powerful DXY’s gains on Friday.

Critical rates have increased by one further increase of 75 basis points (bps) since the US central bank started raising rates.

Investors will be watching Tuesday’s Retail Sales figures closely in the Eurozone. The economic indicators may continue to trend downward at -1.3%, but they will improve from the previous reading of -2.0%.

In addition, following Christine Lagarde’s hawkish remarks, the European Central Bank (ECB) policy rates are anticipated to rise further.

The ECB President reaffirmed on Friday that the institution would keep raising interest rates until the inflation rate dropped to 2%.