EUR/USD: US Dollar has returned to the fore, 1.0800 level could be on challenge soon
|The single European currency is in defensive mode trying to limit yesterday's losses and defend the 1,08 level.
The Minutes from Fed's latest meeting released yesterday acted as a trigger for the US currency to return to the fore as inflation continues to be the Fed's main concern and several members of the Central Bank retain significant doubts about the path of key rates cuts in in 2024.
At the moment, the biggest probability is gathered for the first rates cut by Fed in September, which in fact after yesterday's announcement presented a small retreat.
I remind once again that the US dollar is currently holding higher interest rates against the Euro with the prospect of this gap widening in June which could give to US currency further room for gains.
On the other hand the European currency as reminded once again last week maintains the capacity for very good reactions.
Today's agenda is quite interesting with indicators on manufacturing and services sectors in the Eurozone and US standing out.
As they are harbingers of the path of economies investors watch them with particular attention and a possible significant deviation could increase volatility and strongly affect the exchange rate.
Αt the moment the US currency appears to be holding a slight advantage with the mild rise in US Treasury yields supporting the US dollar.
This mild positive momentum in the US currency could be maintained and today and if there are no surprises in news the 1,08 level could soon under challenge.
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