EURUSD recovers its intraday losses after economic sentiment from the Eurozone and Germany.

The EURUSD pair returns to positive territory after cutting initial losses. Following better than expected Economic Sentiment data from the Eurozone and Germany. However, the US Dollar (USD) strengthened versus the Euro (EUR). As traders remained cautious ahead of the release of US inflation data on Tuesday.

The Euro is under pressure from predictions of an ECB interest rate drop at the start of the second quarter.

The Euro meets resistance as speculation grows about anticipated interest rate cuts. By the European Central Bank (ECB) at the beginning of the second quarter. Piero Cipollone. A member of the ECB Executive Board, stated. That the ECB may not need to further restrict demand in order to combat inflation. Implying that interest rates may not need to be raised further.
The US Dollar Index (DXY). Which tracks the US dollar against a basket of six major currencies, remains on an upward trend for the second consecutive day. Expectations of inflationary pressures in the United States have fueled speculation that the Federal Reserve (Fed) will refrain from decreasing interest rates at its forthcoming March meeting. This sentiment is increasing the US Dollar’s attractiveness in comparison to the Euro.

Daily Market movers: EURUSD expands its Losses as the US Dollar Improves.

The US Dollar Index is hovering at 104.10, with 2-year. And 10-year US Treasury yields of 4.47% and 4.16%, respectively, at press time.
Traders are pricing in a 14% chance that the Federal Reserve (Fed) will decrease interest rates in March. However, the chances of a rate drop at the May meeting are thought to be around 60%.
Dallas Federal Reserve (Fed) Bank President Lorie K. Logan remarked that there is no immediate need to lower interest rates. She acknowledged “tremendous progress” in lowering inflation, but emphasized the significance of gathering additional evidence to guarantee that this improvement is sustainable.
The US Monthly Budget Statement for January revealed a deficit of $22 billion, slightly more than the

The predicted deficit is $21 billion, with a previous shortfall of $129 billion.
The 3-month and 6-month US Treasury bills were auctioned at yields of 5.23% and 5.065%, respectively.
The Euro rose somewhat as ZEW Eurozone and German Economic Sentiment data came in above estimates, at 25 vs. 20.1 and 19.9 vs. 17.5, respectively.
The German Current Situation ZEW sentiment index. However, falls short of forecasts, coming in at -81.7 vs -79.