EUR/USD remains above 1.0700 amid expectations of Fed refraining from further rate hikes


  • EUR/USD appreciates on improved risk appetite after dovish remarks from Fed Chair Jerome Powell.
  • Fed Chair Powell said that it would take longer than previously anticipated to bring inflation down to the 2% target.
  • The Euro may struggle as the recent Eurozone inflation data have bolstered expectations for a potential rate cut by the ECB in June.

EUR/USD continues to gain ground on Thursday as the prevailing positive sentiment in the market provides support for risk-sensitive currencies like the Euro. This improved risk appetite could be attributed to dovish remarks from Federal Reserve Chairman Jerome Powell on Wednesday. Powell dismissed the likelihood of a further interest rate hike after the Fed decided to maintain interest rates at 5.25%-5.50% in May’s meeting held on Wednesday. The EUR/USD pair inches higher to near 1.0720 during the Asian trading session.

According to a Reuters report, Federal Reserve Chairman Jerome Powell said that progress on inflation has recently stalled, suggesting that it would take more time than previously anticipated to bring inflation down to the central bank’s 2% target. Powell also mentioned that if robust hiring persists and inflation remains stagnant, it would justify delaying rate cuts.

Traders are likely awaiting weekly Initial Jobless Claims, Nonfarm Productivity, and Factory Orders from the United States (US) on Thursday. These releases will likely provide further insights into the state of the United States (US) economy.

From the Eurozone, the Euro could struggle due to a more dovish stance from the European Central Bank compared to the US Federal Reserve. Recent inflation data showed that Eurozone inflation held steady in April, as expected. Additionally, the core inflation fell, strengthening bets for a potential interest rate cut by the ECB in June.

Thursday brings the final HCOB Manufacturing Purchasing Managers' Index (PMI) data, with market expectations aligned with the preliminary figures. This is a leading indicator gauging business activity in the Eurozone manufacturing sector.

EUR/USD

Overview
Today last price 1.0718
Today Daily Change 0.0005
Today Daily Change % 0.05
Today daily open 1.0713
 
Trends
Daily SMA20 1.0715
Daily SMA50 1.0799
Daily SMA100 1.0844
Daily SMA200 1.08
 
Levels
Previous Daily High 1.0733
Previous Daily Low 1.065
Previous Weekly High 1.0753
Previous Weekly Low 1.0624
Previous Monthly High 1.0885
Previous Monthly Low 1.0601
Daily Fibonacci 38.2% 1.0701
Daily Fibonacci 61.8% 1.0681
Daily Pivot Point S1 1.0664
Daily Pivot Point S2 1.0615
Daily Pivot Point S3 1.0581
Daily Pivot Point R1 1.0747
Daily Pivot Point R2 1.0781
Daily Pivot Point R3 1.083

 

 

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