EUR/USD loses ground to near 1.1480 in Monday’s early Asian session.
Safe-haven flows amid the risk of escalation in the Israel-Iran conflict boost the US Dollar.
ECB policymakers signaled a rate pause in July.
The EUR/USD pair softens to around 1.1480 during the early Asian session on Monday. The Greenback edges higher against the Euro (EUR) as US President Donald Trump’s decision to join Israel’s war against Iran sharply escalates the conflict. Traders will closely monitor the developments surrounding the Middle East conflict.
The United States (US) entered the conflict between Israel and Iran over the weekend, with American warplanes and submarines targeting three Iranian facilities in Iran, Fordo, Natanz and Isfahan. Trump said Iran’s key nuclear enrichment facilities had been “totally obliterated” and warned of “far greater” attacks unless Iran agreed to make peace. The rising tensions after the US bombed Iran's nuclear sites boost the safe-haven currency like the Greenback and act as a headwind for the major pair.
Across the pond, the European Central Bank (ECB) cut interest rates for the eighth time in a year earlier this month to support a sluggish recovery in the Eurozone but clearly signaled a pause in July. ECB President Christine Lagarde said that rate reductions are coming to an end as the central bank is now “in a good position” to deal with prevailing uncertainties. The hawkish tone from the ECB could help limit the Euro’s losses in the near term.
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