EURUSD pair gains slightly at 1.0725 as the US dollar falls.
After rebounding off the low of 1.0697, the EURUSD pair regains some lost territory around 1.0725. The comeback of the key pair is aided by the weakening of the US dollar. Meanwhile, the US Dollar Index (DXY) falls to 104.70.
US Treasury Secretary Janet Yellen stated that the US can manage inflation without negatively impacting the labor sector.
Janet Yellen, US Treasury SecretaryOn Sunday, she stated that she is growing more persuaded that the United States would be able to control inflation without negatively impacting the job market. She went on to say that every measure of inflation is down, and there has been no major wave of layoffs.
Last week’s positive US economic data adds credibility to the higher for longer interest rate narrative in the US. According to the CME FedWatch Tool, markets have priced in a 93% likelihood of a rate hold at the September meeting and a 43.5% chance of a rate rise at the November meeting. As a result, the US Dollar (USD) may rise, limiting the EURUSD’s upside.
According to Fed Governor Christopher Waller, theThe Fed has capacity to hike interest rates, but the facts will decide. While Fed Boston President Susan Collins warned of the dangers of an overly restrictive monetary policy and urged for a patient, prudent, yet deliberate strategy. Austan Goolsbee, President of the Chicago Fed, emphasized the central bank’s mission of guiding the economy down a “golden path.” This path shows a situation in which inflation lowers but there is no recession.
The European Central Bank (ECB) is expected to keep interest rates steady at its policy meeting on Thursday.
Analysts predict that the European Central Bank (ECB) will leave interest rates unchanged at its upcoming policy meeting on Thursday. According to Destatis data issued on Friday, the German Harmonised Consumer Price Index (HICP) for August came in at 6.4% YoY, as predicted by the market, while the core CPI remained remained constant at 6.1%. Furthermore, GDP in the Eurozone rose by 0.1% in the second quarter (Q2), compared to 0.3% in the previous quarter and 0.3% predicted.
EURUSD participants are looking forward to the US Consumer Price Index (CPI) and the ECB’s interest rate decision meeting.
EURUSD Investors will be watching the August Consumer Price Index (CPI) attentively on Wednesday. The monthly figure is expected to rise by 0.5%, while the monthly core figure will remain constant at 0.2%. The spotlight will move to the ECB’s monetary policy on Thursday. The event might give a clear direction for the EURUSD pair.
