- EUR/USD is juggling around 1.0733 ahead of multiple economic events.
- An improvement is expected in the eurozone jobless rate at 6.7% vs. 6.8% earlier.
- ECB policymaker is expecting two consecutive rate hikes in June and September by 25 bps.
The EUR/USD pair is displaying back and forth moves in a narrow range of 1.0730-1.0740 in early Tokyo. The major displayed a sheer reversal on Tuesday after hitting a low of 1.0679. A firmer rebound in the shared currency bulls is backed by rising odds of a rate hike by the European Central Bank (ECB) in its June monetary policy.
Soaring inflation in the eurozone is demanding the deployment of quantitative measures, which will incorporate a ceiling on the inflationary pressures. On Tuesday, Eurostat reported the annual Harmonized Index of Consumer Prices (HICP) at 8.1% vs. the expectation of 7.7% and the prior print of 7.4%. A significant upside in the inflation numbers in Europe is compelling for an end of the lower rates cycle and rate hikes will be featured by the ECB in its upcoming monetary policy meetings.
Meanwhile, ECB Chief Economist Philip Lane has advocated two consecutive interest rate hikes by 25 basis points (bps) in June and September. This has bolstered the odds of a rebound in the ECB’s interest rate curve.
Going forward, investors will focus on the speech from ECB President Christine Lagarde and the release of the eurozone Unemployment Rate. Considering the galloping inflation levels, investors should brace for hawkish commentary from ECB’s Lagarde. While the eurozone Unemployment Rate is seen at 6.7% against the prior print of 6.8%.
On the dollar front, the US dollar index (DXY) is experiencing barricades around 101.80 ahead of the ISM Manufacturing PMI, which is seen lower at 54.5 against the former figure of 55.4.
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
EUR/USD grinds higher above 1.0550 amid a cautious start to the week
EUR/USD grinds higher above 1.0550 in Monday’s European session. The pair shrugs off the re-emergence of the Russia-Ukraine geopolitical risks as the US Dollar stalls its uptrend. Divergent ECB-Fed policy outlooks could cap the upside ahead of central banks' talks.
GBP/USD defends 1.2600 on subdued US Dollar
GBP/USD defends minor bids above 1.2600 in the early European session on Monday. A broadly subdued US Dollar and less dovish BoE policy outlook support the pair amid cautious market mood, induced by resurfacing Russia-Ukraine conflict. BoE- and Fed-speak eyed.
Gold price faces rejection near $2,600; bulls remain on the sidelines despite softer USD
Gold price (XAU/USD) struggles to capitalize on its modest intraday gains to the $2,600 neighborhood, though it manages to hold in positive territory through the early part of the European session on Monday.
Bonk holds near record-high as traders cheer hefty token burn
Bonk (BONK) price extends its gains on Monday after surging more than 100% last week and reaching a new all-time high on Sunday. This rally was fueled by the announcement on Friday that BONK would burn 1 trillion tokens by Christmas.
The week ahead: Powell stumps the US stock rally as Bitcoin surges, as we wait Nvidia earnings, UK CPI
The mood music is shifting for the Trump trade. Stocks fell sharply at the end of last week, led by big tech. The S&P 500 was down by more than 2% last week, its weakest performance in 2 months, while the Nasdaq was lower by 3%. The market has now given back half of the post-Trump election win gains.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.