- EUR/USD is hovering around 1.0720, eyes 1.0750 amid a recovery in investors’ risk appetite.
- Fed could pause further rate hikes to restore confidence among the market participants.
- ECB Lagarde confirms that Eurozone banks' exposure to Credit Suisse was in Euro millions, not billions.
The EUR/USD pair is displaying a sideways performance around 1.0720 in the early Asian session. The major currency asset is expected to extend its journey toward the critical resistance of 1.0750 ahead. The shared currency pair has registered a three-day winning streak and is expected to extend further as investors are skeptical about the interest rate decision by the Federal Reserve (Fed), which is scheduled for Wednesday.
A late recovery in S&P500 allowed it to settle Monday’s session on a decent positive note. It seems that investors cheered the collaborative efforts made by various financial institutions to rescue the First Republic after the collapse of Silicon Valley Bank (SVB) and Signature Bank. The recovery move by United States equities is portraying a decent attempt for bulls to settle their feet.
The US Dollar Index (DXY) is expected to settle on a negative note consecutively for the third time as investors are still ambiguous about Fed’s monetary policy.
As per the CME Fedwatch tool, more than 76% odds are in favor of a 25 basis point (bps) interest rate hike, which would push rates to 4.75-5.00%. However, the efforts by various central banks to safeguard the global economy from potential banking turmoil indicate that Fed chair Jerome Powell could pause further rate hikes to restore confidence among the market participants.
The discussions over the interest rate guidance could soften the US Dollar for a longer period. Economists at Scotiabank believe that the US Dollar could weaken if the market believes that the Fed is near to end of its tightening cycle.
On the Eurozone front, positive commentaries from European Central Bank (ECB) President Christine Lagarde and other policymakers fueled strength in the Euro. ECB Lagaqrde told European Parliament's Committee on Economic and Monetary Affairs on Monday that Eurozone banks' exposure to Credit Suisse was in Euro millions, not billions, per Reuters.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
AUD/USD: The hunt for the 0.7000 hurdle
AUD/USD quickly left behind Wednesday’s strong pullback and rose markedly past the 0.6900 barrier on Thursday, boosted by news of fresh stimulus in China as well as renewed weakness in the US Dollar.
EUR/USD rebounds on Thursday after midweek pullback
EUR/USD tuned back into the high end on Thursday, getting bolstered by a broad-market selloff in the Greenback. US data that printed better than expected helped to ease concerns of a possible economic slowdown within the US economy looming over the horizon.
Gold holding at higher ground at around $2,670
Gold breaks to new high of $2,673 on Thursday. Falling interest rates globally, intensifying geopolitical conflicts and heightened Fed easing bets are the main factors.
Ethereum investors show bullish bias amid ETF inflows and positive funding rates, exchange reserves pose risk
Ethereum traded around $2,640 on Thursday, up more than 2% following increased bullish bias among investors, as evidenced by ETH ETF net inflows and an uptrend in funding rates. However, investors may be wary of a potential correction from ETH's rising exchange reserve.
RBA widely expected to keep key interest rate unchanged amid persisting price pressures
The Reserve Bank of Australia is likely to continue bucking the trend adopted by major central banks of the dovish policy pivot, opting to maintain the policy for the seventh consecutive meeting on Tuesday.
Five best Forex brokers in 2024
VERIFIED Choosing the best Forex broker in 2024 requires careful consideration of certain essential factors. With the wide array of options available, it is crucial to find a broker that aligns with your trading style, experience level, and financial goals.